Stocks rebound as mart hopes for US-China deal

By Arra B. Francia, Senior Reporter

STOCKS recovered on Thursday as investors were optimistic on the trade talks between the United States and China next week.

The benchmark Philippine Stock Exchange index (PSEi) climbed 1.35% or 110.69 points to close at 8,272.18 yesterday, bouncing back from the previous session’s steep decline. The broader all-shares index likewise rose 0.75% or 37.60 points to 4,993.84.

“Philippine shares rebounded ahead of next week’s trade talks as China approved tariff-free US soybean purchases as goodwill,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.

Trade negotiators from the US will be flying in to China next week for another round of trade talks, with the White House said to be eyeing a longer-term timeline for the deal.

The PSEi managed to end higher despite losses in the morning, as index heavyweight Jollibee Foods Corp. (JFC) continued to be sold down after its deal to acquire The Coffee Bean & Tea Leaf brand for $350 million.

“JFC remained to be the main drag in the index as it fell this time by 6%, having the highest net foreign selling print of P751 million — the stock still reeling from the company’s recent acquisition of Coffee Bean,” Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said in an e-mail.

Shares in JFC were the most actively traded for the day, ending 5.98% lower or P15 to close at P236 each.

Four sectoral indices ended in positive territory, led by the holding firms counter as it jumped 1.92% or 152.46 points to 8,077.35. Financials surged 1.67% or 30.84 points to 1,873.53; property went up 0.95% or 41.55 points to 4,401.11; and services firmed up 0.56% or 9.35 points to 1,669.69.

Meanwhile, industrials dropped 0.82% or 94.62 points to 11,407.16, alongside mining and oil which plunged 0.61% or 49.32 points to 8,038.13.

Turnover improved to P8.27 billion after some 894.31 million issues switched hands, higher than Wednesday’s P6.44 billion.

Despite the main index’s uptick, market breadth was negative with 124 decliners compared to 79 advancers. Forty-eight names were unchanged.

Foreign investors went back to buying mode with P124.46 million in net purchases, against the previous session’s P542.01-million net outflow.

“With the index managing to close above its 20-day moving average support at 8,160, it now has potential to retest its recent high of 8,419.59,” Mr. Perez said.

Wall Street ended mixed amid weak manufacturing data. The Dow Jones Industrial Average dipped 0.29% or 79.22 points to 27,269.97. The S&P 500 index gained 0.47% or 14.09 points to 3,019.56, while the Nasdaq Composite index went up 0.85% or 70.10 points to 8,321.50.