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Market down; Wilcon, PLDT slip

Stocks declined Wednesday in step with the rest of Asia, as fresh trade worries and uncertainty about the Federal Reserve’s plans for cutting interest rates weighed on investors.

The Philippine Stock Exchange Index fell 30.09 points, or 0.4 percent, to 8,233.48 on a value turnover of P5.3 billion. Losers edged gainers, 89 to 85, with 67 issues unchanged.

SM Prime Holdings Inc., the biggest integrated property developer owned by the Sy Group, lost 1.4 percent to P38.70, while Wilcon Depot Inc., a leading home improvement and construction material  supplier, dropped 2 percent to P16.38.

Robinsons Land Corp. of the Gokongwei Group, declined 2.2 percent to P26.40, while PLDT Inc., the largest telecommunications firm, slipped 1.2 percent to P1,185.

The rest of Asian markets fell while fears of a hard Brexit kept the pound wallowing at more than two-year lows.

Oil prices were also struggling owing to questions about the outlook for the global economy, the China-US tariffs stand-off and a stronger dollar.

After last week’s optimism sparked by Fed boss Jerome Powell’s nod to a cut in rates, investors were taking a more sober view after a number of positive readings on the US economy including on retail sales.

The readings—while coming alongside figures showing a drop in the manufacturing sector—revived worries that the Fed will only make one small reduction in borrowing costs this month, and possibly not make any more this year.

The possibility of rates staying slightly elevated boosted the dollar against the yen, euro and pound on Tuesday and held up in early trade Wednesday.

The pound was taking another hiding with the possibility of a no-deal Brexit growing ever more likely as the two contenders to become prime minister slug it out by trying to take increasingly tough lines with the EU. The sterling is now at its lowest level since April 2017.

“We should wait for the new PM to be crowned and settled first before making big calls on where Brexit is going, but the uncertainty will continue to weigh,” said Neil Wilson, chief market analyst at  Markets.com.

The dollar also climbed against most higher-yielding, riskier currencies, jumping 0.8 percent against the Mexican peso, 0.3 percent on the Australian dollar and 0.2 percent versus South Korea’s won.

Regional equity markets were also in the red, with confidence jolted by comments from Donald Trump that revived trade tensions with China.

Hong Kong, Shanghai and Tokyo were all well down, while there were also losses in Singapore, Taipei and Jakarta, with Seoul off 0.9 percent as South Korea’s trade stand-off with Japan drags on.

Sydney, Wellington and Mumbai were slightly higher.

Trump said Washington and Beijing were still a long way from a trade deal and that he still could impose higher tariffs on Chinese imports if he did not get his way.

His remarks, hitting out at what he says is a lack of follow-through from Beijing on promises to buy more farm goods, came just as high-level talks were due to take place this week, though a face-to-face has still not been agreed. With AFP

Topics: Stock Market , Philippine Stock Exchange Index , Philippine Stock Exchange , PSE , PSEi , Wilcon , PLDT
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