PSEi breaks 6000 levels Tuesday, June 2, 2020. Shares on the Philippine Stock Exchange sustained the momentum from Monday’s rally following the moves to relax quarantine measures and to reopen the economy from shutdowns aimed at containing the coronavirus pandemic.
The benchmark PSEi climbed 95.00 points or +1.60% to 6,025.17 at the closing bell. The broader All Shares gained 41.50 points or +1.18% to 3,551.72.
This week began with the re-opening of several regional economies after weeks-long lockdowns to curb the spread of the virus were eased. Investors also cheered signs of the economy picking up in China, the region’s biggest trading partner.
Markets shrugged off escalating protests in the United States, as well as an on-going Sino-U.S. tensions over Hong Kong, which could threaten the long-drawn trade deal between Beijing and Washington.
The focus had instead been on catching this reopening optimism train with confirmation bias potentially being at works
The gains also tracked a modest advance on Wall Street overnight. Investors are balancing cautious optimism about the reopening of businesses shut down because of the pandemic against worries that widespread protests in the U.S. over police brutality could disrupt the economic recovery and widen the outbreak.
Hopes for a quick recovery from the worst global downturn since the 1930s have helped spur buying. But investors are warned against too much optimism, given the tensions between the U.S. and China, unrest in Hong Kong and the U.S., and uncertainties over prospects for a vaccine or dependable treatments for COVID-19, the illness caused by the new coronavirus.
How long can markets remain buoyant? The honest answer is no one knows.
The protests that have rocked American cities for days have so far not had much impact on financial markets. But the violence and damage to property may hinder the re-opening of the economy. Crowds gathering to protest injustice and racism also could touch off more outbreaks.
The market has been expecting a springtime for economic activity. If these events derail the animal spirits that the markets have been counting on, then they will have an impact. But investors are dismissing it as a short-term, non-event.
The Philippines extended its winning streak to a fifth session.
Benchmark U.S. crude oil added 7 cents to $35.51 a barrel in electronic trading on the New York Mercantile Exchange. It fell 5 cents to $35.44 a barrel Monday. Brent crude oil, the international standard, gained 20 cents to $38.52 a barrel.
More than 1.007-billion shares valued at P7.286-billion changed hands. Market breadth was positive as advancers outnumbered decliners, 117 to 61 and 43 issues were unchanged. More..
Stockbytes PH, June 3, 2020
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