The stock market closed lower Thursday in cautious trading as investors continued to consolidate their positions and ignored Wall Street’s rally overnight.
The Philippine Stock Exchange Index slipped 18.63 points, or 0.3 percent, to 6,256.17 on a value turnover of P6.1 billion. Gainers, however, outnumbered losers, 107 to 69, with 60 issues unchanged.
SM Investments Corp. of the Sy Group fell 1.8 percent to P774, while unit SM Prime Holdings Inc., the biggest mall operator, also declined 1.8 percent to P36.10.
BDO Unibank Inc., the biggest lender in terms of assets, however, rose 2.5 percent to P121, while major property developer Ayala Land Inc. of the Ayala Group climbed 1.2 percent to P25.50.
The euro, meanwhile, rose Thursday after Russia resumed gas supplies to Europe, while traders await a crucial European Central Bank policy meeting, with the continent’s equities struggling.
The news helped Asian markets, which recovered from an early sell-off to end mixed following news that the Nord Stream 1 pipeline’s taps had been switched back on after 10 days of maintenance.
The announcement removed a measure of uncertainty among traders who had feared Moscow would keep gas flows cut in retaliation for Brussels’ sanctions imposed after Vladimir Putin’s invasion of Ukraine.
Putin had said the Nord Stream 1 pipeline would be turned back on, but added that supplies would be limited unless a row over some elements of the sanctions is resolved.
Western leaders remain cynical regarding Putin’s plans ahead of the northern hemisphere winter, and the European Commission has urged European Union members to reduce demand for natural gas by 15 percent over the winter to counter Russia’s “blackmail.”
After a negative start, Asian and European equities mostly rose, with the more upbeat mood following another rally on Wall Street thanks to healthy earnings.
Tokyo, Sydney, Seoul, Mumbai, Taipei, Bangkok and Wellington advanced but Hong Kong, Shanghai and Singapore fell, while London, Paris and Frankfurt retreated in early exchanges.
Analysts remain cautious about the near-term outlook for the global economy as it is rattled by a range of issues including the Ukraine war, an energy crisis, and China’s slowdown and supply chain snarls.
The euro climbed again, having fallen to parity with the dollar last week partly because of the European Central Bank’s slow response to inflation compared with the Federal Reserve’s series of sharp rate hikes.
Focus is now on the ECB as it prepares to hike rates for the first time in more than a decade, with most observers expecting a quarter-point lift and some speculating about a half-point move.
Officials are walking a tightrope, as they must try to tame red-hot inflation while not tipping the economy over a cliff, all against the backdrop of an energy crisis sparked by Russia’s invasion of Ukraine.
Added to the mix is a fresh political crisis in Italy that saw Prime Minister Mario Draghi ousted Thursday, which could lead to months of uncertainty. With AFP