Philippine Market Recap Sept 4, 2018

Market Recap

Philippine share prices closed in the green, despite investors moving cautiously as they await the latest developments in Donald Trump’s trade spats with China and Canada.

The bellwether PSEi rose 49.60 points or 0.63% to 7,881.82 at the closing bell. The broader All Shares gained 23.69 points or 0.50% to 4,795.86.

Local equities bucked the regional downtrend, and with US markets closed for the Labor Day holiday, there were few catalysts to drive business though dealers remain nervous after Trump said he wanted to impose fresh tariffs ion a huge swathe of Chinese goods by the end of this week.

Dealers are now keeping a close eye on Trump’s next move after he said last week he wanted to impose tariffs on $200-bil of Chinese imports as soon as public consultation ends on Thursday, adding to the $50-bil already targeted.

Also, US and Canadian officials are still due to resume talks Wednesday on a revised NAFTA deal, after they failed to reach an agreement last week. That led Trump to tweet that he would leave his northern neighbors out of a final pact. Mexico and the US have already struck a deal.

President Trump's war of words against Canada amid negotiations of the NAFTA trade agreement raised concerns that his stance against other countries such as China would remain combative.

News that inflation’s seven-month rise will likely show signs of slowing even as it appears to have hit a new nine-year high in August gave investors a reason to be optimistic.

The inflationary momentum is easing as shown by the forecast deceleration in the month-on-month price change to 0.38% from 0.51% last month, even as the year-on-year change is projected to hit 5.9%, according to the Department of Finance.

However, investors remain wary as overall economic growth is likely seen to fall short of the official target this year, partly due to quickening inflation even as infrastructure development should pick up steam.

More than 874.589-mil shares valued at P5.938-bil, changed hands. Market breadth was positive, advancers beating decliners, 101 to 87, and 52 issues were unchanged.

Gainers: SCC (+3.21%), GTCAP (+2.78%), AGI (+2.65%), SMC (+2.29%), DMC (+1.89%)
Laggards: AEV (-0.56%), PCOR (-0.55%), EMP (-0.14%), BPI (-0.11%), SECB (-0.05%)