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Market extends rally; PLDT rises

The stock market climbed for the fourth straight day Wednesday, buoyed by continued bargain hunting and prospects of a solid economic growth despite higher inflation.

The Philippine Stock Exchange Index surged 81.08 points, or 1.1 percent, to 7,348.42 on a value turnover of P4.9 billion. Gainers and losers were even at 100 each, with 56 issues unchanged.

Casino operator Bloomberry Resorts Corp. advanced 4.4 percent to P10.18, while PLDT Inc., the biggest telecommunications company, gained 2.4 percent to P1,299.

SM Prime Holdings Inc. of retail tycoon Henry Sr. rose 2.8 percent to P37, while BDO Unibank Inc., the largest lender in terms of assets, added 2.1 percent to P128.60.

The rest of Asian markets were down Wednesday as trade tensions between the US and China continued to weigh on investor sentiment ahead of the imposition of new tariffs.

Hong Kong was flat at the open and later fell 1.0 percent, after a Tuesday sell-off that saw the market fall more than three percent at one point.

The benchmark Shanghai Composite Index also closed down 1.0 percent, with while Tokyo’s Nikkei was off 0.31 percent.

Wall Street ended the session down in a shortened trading day ahead of Wednesday’s Independence Day holiday, with falls in tech stocks pressuring the market.

Concerns remain for Shanghai, which is down more than 20 percent from its January high on concerns about a slowing economy, even before new US tariffs threatened by Donald Trump kick in Friday.

China’s yuan is also under pressure, though it leveled after a rally on comments from central bank chief Yi Gang, who pledged to keep the exchange rate stable and avoid using the currency as a weapon in any trade war.

The unit has fallen around eight percent since the end of March, adding to fears about the economy as leaders struggle to cap massive debt while supporting growth.

Despite the central bank’s reassurances, “the markets remain very bearish on China... well over and above trade tensions, as waning growth momentum has contributed to diverging economic indicators versus the US,” said Stephen Innes, head of Asia-Pacific trade at OANDA.

“Unless there’s compromise in the trade dispute, the yuan should remain under pressure,” he added.

But there is little sign of an easing in the standoff between Beijing and Washington, with a Chinese court decision to temporarily ban chip sales by US tech company Micron Technology further souring the atmosphere.

While the case was primarily a dispute between Micron and a Taiwanese firm, the ruling comes after the US blocked China Mobile from the US market.

The move fueled “speculation the decisions were part of the tit-for-tat trade war,” wrote David de Garis, director of economics and markets at National Australia Bank.

Tokyo traders were cautious about the trend in Chinese stocks but “with the prospects that the yuan’s depreciation is bottoming out... buying back supported the Japanese market later,” Okasan Online Securities strategist Yoshihiro Ito said in a commentary. With AFP

Topics: stock market , economic growth , Philippine Stock Exchange Index , Bloomberry Resorts Corp. , PLDT Inc.
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