Asian markets mixed after Wall St tumble as recession fears return

HONG KONG - Markets were mixed Thursday while oil prices fell and the dollar weakened after disappointing US data renewed worries about a recession in the world's biggest economy.

The optimism that has flowed through trading floors since the start of the year took a knock this week as concern about inflation and rising interest rates are replaced by growth fears and their impact on company profits.

The downbeat mood offset hopes that China's economy will enjoy a strong recovery this year -- having suffered its worst annual growth in 46 years in 2022 -- as it moves away from its zero-Covid policy.

All three main indexes on Wall Street sank more than one percent Wednesday in response to figures showing retail sales, and shrank at the quickest pace in more than a year, while producer prices fell the most since the beginning of the pandemic. 

Industrial production also came in worse than forecast.

While data indicating the economy was struggling has in recent months spurred equities on hopes it will allow the Federal Reserve to slow down its pace of rate hikes, analysts said traders are now concerned about the economic outlook.

"'Bad news is bad news' once again for markets, with weak retail sales and industrial production seeing risk assets sell-off," said National Australia Bank's Tapas Strickland.

The data "adds to the theme of the economy slowing and heading into recession in 2023, and pushes back on the soft landing narrative dominating markets since January".

Tokyo, Hong Kong, Singapore, Mumbai and Manila all fell, though Shanghai, Sydney, Seoul, Bangkok and Jakarta edged up.

Wellington's NZX 50 and the New Zealand dollar suffered only small losses despite Prime Minister Jacinda Ardern's shock announcement that she will step down next month, saying she no longer has "enough in the tank".

Expectations that US interest rates will not rise as much as previously feared weighed on the dollar, with the yen bouncing back strongly after Wednesday's Bank of Japan decision not to further tweak monetary policy.

However, several Federal Reserve officials have pushed back against such speculation, warning they will continue to tighten policy until they have brought inflation down from its multi-decade highs.

Worries about recession were also weighing on oil prices, despite hopes for a spike in demand as China reopens to the world. Both main contracts dropped around one percent in afternoon exchanges.

But SPI Asset Management's Stephen Innes said Asian investors could be in for a positive year.

"The clear message to start 2023 has been clear as a whistle: while last year was about Fed and ECB normalization, this year will be about China and Japan normalization, which should continue to drive Asia’s fortunes higher in 2023," he said in a note. 

Key figures around 0710 GMT 

Tokyo - Nikkei 225: DOWN 1.4 percent at 26,405.23 (close)

Hong Kong - Hang Seng Index: DOWN 0.1 percent at 21,656.55

Shanghai - Composite: UP 0.5 percent at 3,240.28 (close)

Dollar/yen: DOWN at 127.84 yen from 128.80 yen on Wednesday

Euro/dollar: UP at $1.0805 from $1.0797 

Pound/dollar: DOWN at $1.2341 from $1.2344

Euro/pound: UP at 87.53 pence from 87.43 pence

West Texas Intermediate: DOWN 1.2 percent at $78.51 a barrel

Brent North Sea crude: DOWN 1.0 percent at $84.13 a barrel

New York - Dow: DOWN 1.8 percent at 33,296.96 (close)

London - FTSE 100: DOWN 0.3 percent at 7,830.70 (close) 

Agence France-Presse

Asia extends stocks rally as dollar drops on Fed rate optimism

HONG KONG –– Asian stocks extended a global rally Thursday and the dollar sank after Federal Reserve boss Jerome Powell flagged a rate hike slowdown and China signaled a softer approach to fighting COVID.

A growing sense of hope that months of sharp monetary tightening around the world is finally reining inflation back from its decades-long highs sent equities surging in November, even as policymakers warned more work had to be done.

And in a much-anticipated speech Wednesday, Powell said the full effects of the Fed's belt-tightening had yet to be felt but that it "makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down".

He signaled the US central bank's December gathering would likely see officials lift borrowing costs by 50 basis points, having pushed them up by a bumper 75 points at the past four meetings.

However, Powell did say policy would need to remain tight "for some time" to restore price stability, echoing comments from other Fed officials who suggested there might not be any cuts until 2024.

Analysts said the reaction to Powell's remarks -- which had been expected to be his most dovish in some time -- highlighted a sense of relief among investors that a long-hoped-for pivot was on the cards.

All 3 main indexes on Wall Street surged, with the Nasdaq leading the way as rate-sensitive tech firms rocketed.

The gains extended November's rally and helped claw back more of the hefty losses suffered for much of 2022.

The dollar also suffered a sell-off, tanking more than 1 percent against the yen to levels not seen since August.

The greenback's losses come after it soared across the board this year as Fed monetary policy diverged more and more from other central banks.

CHINA COVID HOPE

Investors were "putting those nasty thoughts of a bear market to bed as the December Santa Rally springs alive", said Stephen Innes at SPI Asset Management.

"Indeed investors are reveling in the afterglow of moderating Fed signals. And with the Fed done with jumbo hikes, it's seemingly enough to mark the bottom in the bear market and could lead to a sustainable rally."

He added that bets on rates topping 5 percent were fading and the advance in markets could push into the new year, with another slowdown in November inflation potentially fueling a bull rally -- when a market rises 20 percent from its recent low. 

"Still," he warned, "inflation will need to play along."

In another sign of hope, data earlier showed that eurozone inflation eased for the first time in 17 months in November.

Hong Kong led the gains in Asia again, with tech giants including Alibaba and Tencent tracking massive gains in their US-listed stock, while Shanghai ended well up.

Those rallies were also helped by signs that China is edging towards a more pragmatic approach to fighting the coronavirus, having hammered the economy this year with its strict zero-COVID strategy of lockdowns and mass testing.

After widespread unrest against the measures -- and calls for more political freedoms -- authorities have announced moves aimed at loosening some restrictions.

On Wednesday, Vice Premier Sun Chunlan, who heads China's COVID campaign, told the National Health Commission that the fight was entering a new phase as omicron weakens and more people are vaccinated.

Bloomberg News also noted that she did not refer to "dynamic COVID-zero", the term used to explain Beijing's strategy. 

"It is clear that the authorities are setting the stage for COVID measures to be relaxed," said Justin Tang, at United First Partners. "Equity prices will see a boost as China joins the rest of the world in living with COVID."

Among other markets, Tokyo, Sydney and Taipei added more than one percent while Singapore, Seoul, Wellington, Mumbai and Bangkok were also in positive territory.

Key figures around 3:10 p.m. in Manila

Tokyo - Nikkei 225: UP 0.9 percent at 28,226.08 (close)

Hong Kong - Hang Seng Index: UP 1.3 percent at 18,841.88

Shanghai - Composite: UP 0.5 percent at 3,165.47 (close)

Dollar/yen: DOWN at 136.30 yen from 138.03 yen on Wednesday

Euro/dollar: UP at $1.0454 from $1.0408 on Wednesday

Pound/dollar: UP at $1.2114 from $1.2052

Euro/pound: DOWN at 86.30 pence from 86.34 pence

West Texas Intermediate: DOWN 0.5 percent at $80.15 per barrel

Brent North Sea crude: DOWN 0.5 percent at $86.50 per barrel

New York - Dow: UP 2.2 percent at 34,589.77 (close)

London - FTSE 100: UP 0.8 percent at 7,573.05 (close)

Agence France-Presse

Tokyo shares softer in early trade

TOKYO - Tokyo shares drifted lower Monday morning as the global high-tech sector faces pressure.

The benchmark Nikkei 225 index eased 0.31 percent, or 86.81 points, to 28,196.22, while the broader Topix index fell 0.16 percent, or 3.17 points, to 2,014.83.

Agence France-Presse

Turkish lira hits another historic low amid pandemic

LONDON (AP) — Turkey’s currency tumbled further Friday, hitting another record low.

The Turkish lira dropped to 7.3677 against the dollar before making a recovery. The lira is down about 19% versus the U.S. currency since the beginning of the year. It was trading around 7.17 on Friday afternoon.

The drop is fueled by high inflation, a wide current account deficit and the Turkish government’s push for cheap credit to drive an economy that was already fragile before the COVID-19 pandemic hit.

Analysts have expressed concerns over the level of Turkey’s reserves and Turkish President Recep Tayyip Erdogan’s aversion to high interest rates.

Turkey had been hoping for an influx of foreign currency through exports and tourism revenues, but the pandemic has sharply undermined the tourism industry and disrupted global commerce.

Speaking after Friday prayers at the recently reconverted Hagia Sophia mosque in Istanbul, Erdogan said “there are serious zigzags in the global economy after the pandemic.”

He added: “I believe the Turkish lira will fall into place ... these are temporary fluctuations.”

AP

Stock markets mixed as China-US tensions return to fore

Equities were mixed Wednesday as profit-taking and worries about deteriorating China-US relations were weighed against optimism over the gradual reopening of economies around the world.

Hong Kong extended losses as police fired pepper-ball rounds as anti-China protesters took to the city's streets, with investors fearing the demonstrations could erupt into the worst unrest since last summer.

The broad trend across global markets has been upward for weeks as virus deaths and infections ease in most countries and governments begin to reopen their battered economies, fanning hopes for a recovery in the second half of the year.

Confidence has also come from mind-boggling amounts of stimulus and central bank pledges of support, with the latest coming from the eurozone, where European Commission President Ursula von der Leyen is due to unveil a trillion-euro revival plan for the bloc.

However, there was little fresh desire for risk assets with eyes on the simmering row between the world's top two economies, fuelled by Donald Trump's barracking of China over its role in the pandemic, and made worse this week by Beijing looking to tighten its grip on Hong Kong.

The financial hub was thrown back into the spotlight Friday when Chinese officials proposed a controversial security law that many fear could ring the death knell for the city.

And Trump appeared to agree, with his press secretary Kayleigh McEnany telling a briefing he had said it is "hard to see how Hong Kong can remain a financial hub if China takes over".

Washington has already said it could terminate its preferential trading status over the issue.

Markets are also fretting over reports that the US has warned it will impose sanctions on Chinese entities and officials if it goes ahead with the law.

While China and Hong Kong leader Carrie Lam have sought to ease worries about the extent of the law plans, Jeffrey Halley at OANDA warned that no matter how they try to dress it up "the passage of the security legislation from Beijing will have consequences for the beleaguered (city) and will further darken relations between the US and China."

Concerns about the growing crisis have weighed on the yuan, losing almost three percent this year, with observers suggesting it could hit a record low.

- Hong Kong protest worries -

Meanwhile, there are concerns about another flare-up in the city as lawmakers prepare to discuss a law that bans insulting China's national anthem.

Seven months of sometimes violent demonstrations last year hammered the local economy and raised questions about its future.

Hong Kong fell 0.4 percent, Shanghai lost 0.3 percent and Sydney fell 0.1 percent, while Kuala Lumpur dropped more than one percent as Malaysia struggled to contain its virus. There were also losses in Jakarta, Bangkok and Singapore.

But Tokyo, Mumbai, Manila, Seoul, Taipei and Wellington saw gains.

In early trade, London, Paris and Frankfurt were all higher. The gains in Paris as dealers brushed off a warning from officials that France's economy could contract 20 percent in the second quarter.

Still, National Australia Bank's Tapas Strickland, said in a note: "Risk sentiment continues to surge as activity lifts following the gradual easing of containment restrictions around the world, while vaccine hopes remain high with 10 different vaccines currently at the human trial stage."

He also cited comments from Federal Reserve official James Bullard that the third quarter "very likely, right behind the worst quarter, will be the best quarter of all time on the growth perspective".

Wall Street, where the New York Stock Exchange trading floor reopened after two months of closure, finished higher, with the Dow gaining 2.2 percent.

Oil markets slipped on China-US tensions, and after reports said Russia could begin easing up on its supply cuts in July.

Massive reductions by Moscow and other major producers including Saudi Arabia have helped fuel a surge in prices over the past month, with WTI doubling since the end of April.

But analysts said the commodity will likely continue to win support from the easing of lockdowns, which is expected to boost demand as people get back on the road.

- Key figures at around 0810 GMT -

Tokyo - Nikkei 225: UP 0.7 at 21,419.23 (close)

Hong Kong - Hang Seng: DOWN 0.4 percent at 23,301.36 (close)

Shanghai - Composite: DOWN 0.3 percent at 2,836.80 (close)

London - FTSE 100: UP 0.7 percent at 6,112.97

Euro/dollar: DOWN at $1.0954 from $1.0984 at 2040 GMT Friday

Dollar/yen: UP at 107.51 yen from 107.54 yen

Pound/dollar: DOWN at $1.2292 from $1.2335

Euro/pound: DOWN at 89.11 pence from 89.04 pence

West Texas Intermediate: DOWN 2.3 percent at $33.55 per barrel

Brent North Sea crude: DOWN 2.2 percent at $35.37 per barrel

New York - Dow: UP 2.2 percent at 24,995.11 (close)

Agence France-Presse

US stocks edge mostly lower after China virus cases spike

Stocks closed lower on Wall Street Thursday as investors turned cautious following a surge in cases of a new virus in China that threatens to crimp economic growth and hurt businesses worldwide.

The modest losses snapped a three-day streak of record highs for the S&P 500 and Nasdaq composite. The selling marked only the second day this month that the market has declined.

Investors largely set aside worries about the economic impact of the virus outbreak the past two weeks. Markets rallied this week partly due to reports that the number of new cases of the new virus in China had declined.

Hopes that the spread of the virus had peaked were dashed Thursday, when China reported a sharp rise in cases and deaths after the hardest-hit province of Hubei took a new approach to classifying and diagnosing the virus.

“We’re in a data-dearth period in the sense that we’re not really going to know fully the effects of the impact of that on Asian and Chinese growth, as well as global growth, for at least several weeks,” said Lisa Erickson, head of traditional investments at U.S. Bank Wealth Management. “You’re just going to see some back-and-forth movement (in the market) until that time.”

The S&P 500 index dropped 5.51 points, or 0.2%, to 3,373.94. The Dow Jones Industrial Average slid 128.11 points, or 0.4%, to 29,423.31. It was down as much as 205 points earlier.

The Nasdaq fell 13.99 points, or 0.1%, to 9,711.97. The Russell 2000 index of smaller company stocks rose 4.36 points, or 0.3%, to 1,693.74.

Markets in Europe and Asia finished mostly lower. The yield on the 10-year Treasury held steady at 1.62%.

The major U.S. indexes wobbled for much of the day as investors weighed company earnings reports and the latest news on the virus outbreak in China.

The change in how Hubei determines and reports cases of the new virus pushed the number of cases worldwide to more than 60,000.

The spike came after two days in which the number of new cases dropped, complicating efforts to understand the trajectory of the outbreak.


Businesses have already been hurting due to the outbreak and more of them are warning that the effects will linger through the year. Organizers of the world’s biggest mobile technology fair cancelled the event, set to take place in Spain, because of health and safety concerns over the outbreak.

Travel-related companies fell broadly Thursday, shedding some of their gains from earlier in the week. Airlines helped pull industrial sector stocks lower. United Airlines fell 1.5%.

MGM Resorts International, which gets about 20% of its revenue from the gambling haven of Macau, pulled its profit forecast for 2020. The stock lost 5.5%. Cruise line operator Carnival slid 2%.

Technology and health care stocks were among the biggest decliners, along with companies that rely on consumer spending. Cisco Systems fell 5.2%, Mylan slid 2.3% and Hanesbrands dropped 2.6%.

Household goods makers, utilities, real estate companies and communication services stocks notched gains.

Fashion company Ralph Lauren warned that the viral outbreak cut into fourth-quarter sales by an estimated $55 million to $70 million. The stock fell 0.6%.

Alaska Air Group bucked the trend, adding 1.5% after the airline said it will cooperate more closely with American Airlines on West Coast service. The airlines asked for government permission to expand revenue-sharing to cover international flights in Seattle and Los Angeles.

Benchmark crude oil rose 25 cents to settle at $51.42 a barrel. Brent crude oil, the international standard, gained 55 cents to close at $56.34 a barrel. Wholesale gasoline was unchanged at $1.58 per gallon. Heating oil was also unchanged at $1.68 per gallon. Natural gas fell 1 cent to $1.83 per 1,000 cubic feet.

Gold rose $7.70 to $1,575.10 per ounce, silver rose 12 cents to $17.60 per ounce and copper rose 1 cent to $2.62 per pound.
The dollar fell to 109.79 Japanese yen from 110.08 yen on Wednesday. The euro weakened to $1.0843 from $1.086.

source: business.inquirer.net

World shares extend losses ahead of US economic growth data

BANGKOK – Shares edged lower in Europe on Friday following a lackluster day in Asia ahead of the release of U.S. economic growth data later in the day.

Benchmarks fell Friday in Paris, London, Tokyo and Shanghai but rose in Hong Kong and Sydney.


Economists have been upgrading their estimates, with many forecasting that GDP expanded at an annual rate of close to 3% in the first three months of the year. That would be up a full percentage point from previous estimates.

Germany’s DAX was nearly unchanged early Friday at 12,280.80 while the CAC40 in Paris lost 2.33 points to 5,555.34.

Britain’s FTSE 100 fell 0.3% to 7,411.37.

Wall Street looked set for a weak open, with the future contract for the Dow down 0.1% and that for the S&P 500 also off 0.1%.

In Asian trading, concern that China may temper its economic stimulus pulled benchmarks lower for a second straight day.

The Shanghai Composite index fell 1.2% to 3,086.40 while Japan’s Nikkei 225 index slipped 0.2% to 22,258.73.

South Korea’s Kospi declined 0.5% to 2,179.31. Australia’s S&P ASX 200 edged 0.1% higher to 6,385.60, while the Hang Seng in Hong Kong added 0.2% to 29,605.01.

India’s Sensex jumped 0.9% to 39,066.97.

Shares fell in Taiwan, Singapore, Malaysia and Thailand but rose in Jakarta.

China-U.S. trade talks are again on the agenda, for next week in Beijing, with further talks in Washington slated for May 8.

President Donald Trump has said his Chinese counterpart, Xi Jinping, might be visiting the White House soon, but the timing remained unclear. Progress on a deal resolving a conflict over Beijing’s technology policies that has involved billions of dollars in tariffs being imposed on each other’s products would reassure investors who have been rattled by the uncertainty.

In the U.S., earnings reporting season is about a third of the way in, and investors are searching for clues about whether profit growth can accelerate later this year following a weak first quarter.

Analysts are forecasting a drop of 2.8% in earnings for S&P 500 companies this time around, not as bad as the 4% decline they were expecting a few weeks ago.

ENERGY: Benchmark U.S. crude gave up $1.07 to $64.14 per barrel in electronic trading on the New York Mercantile Exchange. It lost 68 cents to $65.21 per barrel on Thursday. Brent crude, the international standard, plunged $1.20 to $72.43 per barrel.

CURRENCIES: The dollar was trading at 111.74 Japanese yen, up from 111.63 yen on Thursday. The euro rose to $1.1141 from $1.1333.  /gsg

source: business.inquirer.net

Wall Street stocks end their worst year since 2008

NEW YORK, United States — The US stock market concluded its worst year since the global financial crisis on Monday following a late-season collapse that also raised doubts about the prospects for 2019.

Major indices notched modest gains in the year’s final session, but it barely made a dent compared with the rest of December, the market’s worst month in nearly a decade.

Ending in the red for 2018 did not appear in the cards in the first weeks of the year, when Wall Street repeatedly shot to new records on the heels of a sweeping tax cut signed into law in December 2017 by President Donald Trump.

But it did not take long for a host of worries to shake that confidence, from unease over an unpredictable series of trade wars launched by Trump, to angst over rising interest rates, to nervousness over economists’ warnings of slowing growth, or worse, a possible recession.

And the declines rapidly accelerated in the final weeks of 2018, erasing all the gains since January.

Concluding the year with losses is “astonishing,” Manulife senior portfolio manager Nate Thooft told AFP. “From an investor perspective, it probably shakes them a bit.”

There was a spurt of renewed optimism on Monday, and the Dow Jones Industrial Average finished the final session with a gain of 1.2 percent at 23,327.46.

The broad-based S&P 500 climbed 0.9 percent to end at 2,506.85, while the tech-rich Nasdaq Composite Index advanced 0.8 percent to 6,635.28.

But even with Monday’s boost, the Dow finished 2018 with loss of 5.6 percent compared to the end of 2017, the S&P 500 with a drop of 6.2 percent and the Nasdaq with a decline of 3.9 percent.

That was after a year in which they indices jumped 25.1 percent, 19.4 percent and 28.2 percent — before companies logged massive jumps in profits this year due in part to the tax cut.

Euphoric start

At the start of 2018, investor sentiment ranged somewhere between optimism and euphoria as the Dow surged above 25,000 for the first time and then hit 26,000 less than two weeks later.

But after that frothy start, stocks experienced their first cracks in late January, just ahead of a leadership transition at the Federal Reserve as Jerome Powell took over as Fed chairman, after Trump declined to nominate Janet Yellen for a second term.

Wall Street suffered an especially profound wobble on Powell’s first day, February 5, with the Dow plunging nearly 1,600 points at one stage before ending a grim session down more than four percent.

At the time, analysts cited worries the Fed would have to hike rates too aggressively.

But Trump’s escalating trade wars and tariff threats soon took over as the main focus of investor concern. He announced the first salvo on March 1: tariffs on imported steel and aluminum. The following day on Twitter he proclaimed that “trade wars are good, and easy to win.”

That has been followed by increasingly aggressive tariff moves against China.

Many key US economic indicators stayed robust even as business leaders recoiled at Trump’s rising protectionism, with unemployment lingering at a 49-year low, corporate earnings notching their strongest growth in eight years, and business and consumer sentiment remaining well above historic trends.

In August, the S&P 500 celebrated the longest-ever “bull market,” with 3,453 straight sessions — more than nine years — without a drop of 20 percent. In October, the Dow surged to an all-time high of 26,828.39.

But it’s been a rough ride ever since.

Bruising finale

Besides worries over the difficult US-China trade talks, much of current angst is focused on the Federal Reserve, which faces a tricky balancing act of boosting interest rates enough to contain inflation without choking off the economic expansion.

Market watchers are always nervous about Fed tightening cycles, especially as they reach their end, fearing they might overdo it, but Trump has dialed up the jitters with repeated attacks on Powell.

Economists warn that such criticism can easily backfire by compelling the US central bank to continue to raise interest rates to demonstrate its independence.

White House officials have denied Trump intends to fire Powell, but many market watchers say the possibility has further pressured stocks, especially given the president’s penchant for setting policy by tweet without consulting his advisors.

A US government shutdown over Trump’s desire to fund a wall along the border with Mexico will extend into 2019 also has dented sentiment, especially amid signs economic growth has peaked.

“To be clear, the challenges we see ahead don’t look to us like the makings of another financial crisis,” said a recent investor note by JPMorgan Private Bank said in a recent investor note.

“Our base case assumes slowing growth in the US economy throughout 2019 and a moderate recession in 2020.”

Thooft of Manulife said the gloom of December feels “a bit overdone” given that most data is still strong.

But he warned that investors are unnerved, and the sense of waning optimism could soon show up in consumer and business sentiment indexes.

“You’re going to need more than one (positive) outcome” to push stocks higher in 2019, he said. “It’s probably bigger than just the trade issue.” /cbb

source: business.inquirer.net

Dollar edges up in Asia after New York sell-off

TOKYO — The dollar edged up against the yen in Asia on Friday after plunging on weak Chinese data which sparked worries over emerging markets.

In Tokyo afternoon trade, the dollar fetched 103.44 yen, up from 103.34 yen in New York Thursday afternoon but still nearly one yen lower than levels in Tokyo on Thursday.

The euro, which climbed Thursday on upbeat eurozone data, bought $1.3684 from $1.3692 in US trade Thursday while it was unchanged at 141.59 yen.

“Risk assets suffered as a much bigger than expected fall in Chinese manufacturing (activity) dented global sentiment,” Credit Agricole said.

Traders moved into the safe-haven yen Thursday as US shares sank on the weak China report and lacklustre corporate earnings, while they look ahead to a Federal Reserve policy meeting next week.

“The poor China data merely exacerbates the worries about emerging markets, and is pushing an acceleration in the investor pullout from these economies, which is not limited to China,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

The data from China — a key driver of global growth — fuelled concerns about emerging markets at a time when the Fed is winding down its stimulus programme, leading foreigners to repatriate their investments to the West.

Argentina’s peso was at 7.9 to the dollar Friday against 8.01 on Thursday, when it had plunged 11.1 percent in the sharpest one-day fall since 2002.

The South American nation is embroiled in a currency crisis that has seen the peso slump about 19 percent so far this year, creating challenges for a government wrestling with falling foreign reserves and mounting inflation.

Boosting the euro, a closely watched report Thursday showed private-sector activity in the eurozone hit a 31-month high in January as a modest recovery gathered pace across the economic bloc.

The dollar was mostly higher against other Asia-Pacific currencies.

It rose to 1,076.70 South Korean won from 1,072.76 won on Thursday, to 12,180 Indonesian rupiah from 12,168 rupiah and to 62.16 Indian rupees from 61.97 Indian rupees.

The dollar also firmed to 45.32 Philippine pesos from 45.30 pesos and to Tw$30.22 from Tw$30.19.

It slipped to 32.86 Thai baht from 32.97 baht and to Sg$1.2785 from Sg$1.2814.

The Australian dollar eased to 87.59 US cents from 87.98 cents, while the Chinese yuan weakened to 17.07 yen from 17.23 yen.

source: business.inquirer.net

US stocks end mostly lower after deluge of data

NEW YORK—US stocks Wednesday ended mostly lower after markets weighed a stream of generally solid economic data ahead of Friday’s big jobs report.

The Dow Jones Industrial Average lost 24.85 points (0.16 percent) at 15,889.77.

The broad-based S&P 500 fell 2.34 (0.13 percent) to 1,792.81 while the tech-rich Nasdaq Composite Index inched up 0.80 (0.02 percent) to 4,038.01.

Markets were in negative territory most of the day after payrolls firm ADP reported strong jobs growth, the US trade deficit declined and October new-home sales notched a 25.4 percent rise compared with the prior month.

On the downside, the Institute for Supply Management’s purchasing managers index for service sector activity fell to 53.9, below the 55 consensus estimate.

But markets pared losses after the Federal Reserve released its Beige Book report, which painted a generally good picture of the economy in the wake of October’s partial government shutdown.

Analysts are awaiting Friday’s monthly jobs report, which could signal whether the Federal Reserve is likely to accelerate a plan to scale back its bond-buying program.

Anthony Conroy, head of global trading at Bank of New York Convergex, said traders are in “more of a profit-taking mood” in anticipation a Fed taper, most likely early in 2014.

“Everybody is looking to every data point trying to get a sense of what the Fed is going to do,” Conroy said.

Conroy does not expect major market swings before the Fed winds up its next policy meeting on December 18.

Agriculture equipment manufacturer Deere & Co. rose 3.2 percent after announcing it was boosting its share buyback program by $8 billion.

Retailer JC Penney fell 4.5 percent despite reporting a 10.1 percent jump in comparable-store sales in November over last year. Sterne Agee called the sales a “step in the right direction,” but said the result was “certainly not heroic” in light of aggressive promotions.

Apparel retailer Express plummeted 23 percent after projecting fourth-quarter earnings of 66-71 cents per share, well below the 78 cents seen by analysts.

Fertilizer company CF Industries shot up 10.7 percent after suggesting it would maintain or accelerate its ongoing share buyback program.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.84 percent from 2.78 percent Tuesday, while the 30-year increased to 3.91 percent from 3.84 percent. Bond prices and yields move inversely.

source: business.inquirer.net

Dollar edges down in Asia ahead of Yellen remarks – Lead

TOKYO- The dollar edged down in Asia Wednesday, taking a breather from a rally driven by speculation the Fed will soon start tapering its huge stimulus drive.

The greenback bought 99.48 yen in Tokyo afternoon trade, weakening from 99.62 yen in New York Tuesday.

The euro strengthened to $1.3447 from $1.3433 while it bought 133.76 yen compared with 133.82 yen in US trade.

Dealers are awaiting remarks Thursday from Janet Yellen, President Barack Obama’s nominee to succeed Chairman Ben Bernanke at the Federal Reserve, said a senior dealer at a major bank in Tokyo.

Some investors want to push the dollar above the 100-yen mark but “many of us just don’t want to make aggressive moves before we confirm Ms Yellen makes no negative surprises,” the dealer said.

Yellen will appear before US senators Thursday to defend her nomination as Fed policymakers debate whether the stimulus policy known as quantitative easing is still needed to support the world’s largest economy.

The central bank will hold its regular two-day policy meeting next month after upbeat US data fuelled speculation that it could start tapering its $85-billion-a-month bond-buying program before year’s end.

Traders also are awaiting eurozone industrial production figures for September, due later Wednesday, which will be followed by July-September economic growth data on Thursday.

The dollar was higher against other Asia-Pacific currencies.

It rose to Sg$1.2495 from Sg$1.2486 on Tuesday, to Tw$29.59 from Tw$29.56, to 63.73 Indian rupees from 63.53 rupees, and to 43.77 Philippine pesos from 43.70 pesos.

The greenback inched up to 31.59 Thai baht from 31.57 baht and to 1,072.93 South Korean won from 1,071.20 won.

The Australian dollar fell to 93.04 US cents from 93.29 cents, while the Chinese yuan was at 16.30 yen against 16.31 yen.

source: business.inquirer.net

Asian stock markets subdued after Wall Street slip

MANILA, Philippines — Asian stock markets mostly flitted between gains and losses Wednesday after an improvement in U.S. service industries reinforced expectations the Federal Reserve will reduce monetary stimulus that has propelled stocks higher.

The Institute for Supply Management’s services index rose in October despite forecasts it would soften due to last month’s partial shutdown of the U.S. government. Investors concluded that it makes it more likely that the Fed will start reducing its bond purchases, which have kept interest rates low, within a few months.

Hong Kong’s Hang Seng inched up 0.2 percent to 23,091.45 and China’s Shanghai Composite added 0.3 percent to 2,164.64. India’s Sensex reversed early losses to rise 0.1 percent to 20,989.24. Benchmarks in Singapore and the Philippines were slightly lower.

Japan’s Nikkei 225 defied the narrow range, reversing early losses to rise 0.9 percent to 14,359.57.

“Nobody is buying,” said Francis Lun of GE Oriental Financial Group in Hong Kong. “I think the biggest news globally is the IPO debut of Twitter tomorrow,” he said.

Other analyst say investors remain cautious ahead of possible market moving data and policy meetings this week.

They include the European Central Bank meeting on Thursday where it may foreshadow a further reduction to record low interest rates and the advance estimate of U.S. third quarter economic growth due the same day. U.S. October jobs figures are due on Friday.

China’s leaders are also scheduled to meet in Beijing from November 9-12 to craft a new blueprint for the world’s No. 2 economy as its state-led growth model runs out of oomph.

On Wall Street, stocks took a break from a record-breaking run.

Some weak corporate earnings reports on Tuesday held the market back, pushing the major indexes slightly lower.

The S&P 500 index dropped 4.96 points, or 0.3 percent, to 1,762.97. The index is nine points below its record close of 1,771.95 set Oct. 29.

The Dow Jones industrial average fell 20.90 points, or 0.1 percent, to 15,618.22. The Nasdaq composite added 3.27, or less than 0.1 percent, at 3,939.86.

Benchmark crude for December delivery was up 50 cents at $93.87 in electronic trading at the New York Mercantile Exchange. The contract fell $1.25 to $93.37 a barrel on Monday.

In currencies, the euro rose to $1.3510 from $1.3476 late Tuesday. The dollar rose to 98.74 yen from 98.51 yen.

source: business.inquirer.net

Asian shares edge lower, reversing earlier gains

HONG KONG — Asian markets edged lower in holiday-hit trade on Monday, reversing earlier gains that were fuelled by upbeat US and Chinese manufacturing data as well as strong US auto sales.

The euro made a small gain after suffering selling pressure last week on expectations the European Central Bank (ECB) will cut interest rates at its next meeting Thursday.

Sydney slipped 0.38 percent, or 20.6 points, to close at 5,390.5 and Seoul fell 0.70 percent, or 14.25 points to 2,025.17. Shanghai closed flat, dipping 0.07 points to 2,149.63 and Hong Kong gave up 0.26 percent, or 60.17 points, to 23,189.62.

Tokyo and Mumbai were closed for public holidays.

US shares finished on a high Friday after figures showed manufacturing activity grew faster than expected in October. That came hours after China said its own purchasing managers’ index (PMI) came in at its highest level for 18 months.

News that October auto sales from the three largest US manufacturers — Chrysler, Ford and General Motors — saw double-digit percentage gains supported Wall Street Friday. The Dow added 0.45 percent, the S&P 500 tacked on 0.29 percent and the Nasdaq was flat.

Over the weekend data showed signs of growth in China’s services sector, as the official non-manufacturing PMI recorded its strongest reading in 14 months.

In China, attention is turning to a Communist Party policy meeting due to start Saturday, with traders looking for possible economic reforms.

Also, Washington will release third-quarter gross domestic product advanced estimates on Thursday and official October non-farm payrolls figures Friday.

On currency markets the euro ticked up slightly after tumbling last week on expectations the ECB would cut interest rates, after figures showed inflation in the region at a four-year low.

The euro bought $1.3492, compared with $1.3482 in New York but well down from $1.3750 on Wednesday. It was at 133.09 yen against 133.10 yen in New York.

“The eurozone has seen poor results in recent months, and there are serious concerns that the inflation rate has gone too low,” Desmond Chua, market analyst at CMC Markets in Singapore, told AFP.

“Investors will be watching if the ECB president Mario Draghi will indicate further monetary easing in the eurozone, with a new long-term refinancing option a viable option,” he said.

The dollar was at 98.65 yen from 98.69 yen in New York. The greenback is being buoyed by speculation the Federal Reserve will begin winding down its stimulus programme next month after it gave an upbeat assessment of the US economy last week.

Gold dropped to $1,313.15 at 0810 GMT compared with $1,316.15 on Friday.

In other markets:

– Taipei fell 0.41 percent, or 34.04 points, to 8,354.14.

Taiwan Semiconductor Manufacturing Co. was 0.46 percent lower at Tw$109.0 while chip design house MediaTek was up by its 7.0 percent daily limit at Tw$432.5.

– Wellington was flat, edging down 3.16 points to 4,910.68.

Fletcher Building fell 2.34 percent to NZ$9.60, Air New Zealand was off 0.57 percent at NZ$3.52 and telecoms firm Chorus climbed 0.38 percent at NZ$2.63.

– Manila closed 0.64 percent lower, giving up 41.99 points to 6,543.39.

Philippine Long Distance Telephone Co fell 1.60 percent to 2,824 pesos.

source: business.inquirer.net

Twitter set to make a splash on Wall Street – Special

NEW YORK – Wall Street is aflutter over Twitter, set to make the most anticipated stock market debut since Facebook in a huge test for social media and the technology sector.

No official date has been set, but Twitter appears on a fast track which could see its initial public offering priced as early as Wednesday for trading on Thursday, according to some reports.

The company will trade under the “TWTR” symbol on the New York Stock Exchange, breaking from the Nasdaq market used by a large number of tech companies.


There is considerable excitement about the IPO because Twitter is “a unique product that no one can replicate,” said Michael Pachter, head of equity research at Wedbush Securities.

Pachter and his colleagues said in a research report that they expect high demand.

“We believe that the market is likely to generate appetite for more than $1 billion in stock,” they said.

“The simple rules of supply and demand suggest that by limiting the supply of shares offered to the public in its IPO, Twitter will be unable to satisfy demand.”

And Twitter appears to have learned a lesson from Facebook’s debacle in May 2012, marked by trading glitches, accusations about secret information and a plunge in the share value for months after the IPO.

“The Facebook situation last year was a perfect storm of an overheated private market, a fully priced offering, a massive amount of shares brought to market, all compounded by an historical technical glitch,” said Lou Kerner, founder of the Social Internet Fund.

“That confluence of events is not likely to occur again.”

As of its latest update, Twitter will seek to raise up to $1.6 billion — one tenth the value of the Facebook IPO — by offering 70 million shares in a range of $17 to $20.

That is a relatively small chunk of Twitter’s capital, and implies a market value between $9.3 billion and $11.1 billion — a conservative figure compared with some of the private market trades in Twitter so far.

Analysts say Twitter, unlike Facebook, will not flood the market, and that with demand exceeding supply the price will rise.

The early Twitter investors may not get maximum value right away, but could benefit over time from a rise in the share price.

Star quality, but questions on monetization

Twitter does have a star quality that is likely to fuel interest, because it is a key platform for celebrities, politicians and journalists.

In its investor presentation, the company used President Barack Obama’s widely retweeted message of “four more years” after his 2012 re-election, and noted how activist investor Carl Icahn’s single tweet about buying Apple shares moved the stock market.

A crucial question for Twitter, as for Facebook, is how deftly the company is able to monetize its platform.

Twitter has some 232 million active users around the world, but has lost money steadily since 2010, according to IPO documents. The losses amounted to $133 million on $422 million in revenues in the first nine months of the year.

Twitter makes most of its money from advertising, chiefly in the form of “promoted tweets.” A recent revamping of its display opens the door to bigger display-type ads.

The investment firm Sterne Agee notes that “Twitter’s scale and deeply engaged user base create valuable opportunities for advertisers to leverage the platform.”

Analysts point out that Twitter can allow companies to advertise for free, or pay for promoted tweets and benefit from analytics that target people based on their interests and profiles.

“Twitter is a niche business that will not likely be used by ‘everybody’ vs. Facebook, which essentially is,” said a report from Pivotal Research Group analyst Brian Wieser.

“However, at the same time we expect that advertisers will continue to value Twitter for its unique attributes and should conceivably allocate budgets from sources intended towards digital goals.”

Risks of an ‘unproven’ model

But the report goes on to say that Twitter faces big risks including “a relatively unproven advertiser proposition, the prospects of wild swings in investor sentiment, difficulty scaling the business profitability, rush sellings at a time when early investor lock-ups expire (and) government regulations primarily related to privacy.”

Still, Pivotal sets a target price of $29 a share, or 46 percent above the high end of the offering price range.

Others note that it is hard to evaluate Twitter’s financial potential because three-quarters of its users are outside the United States where digital advertising is just taking hold.

“Many international ad markets are years behind the US in terms of the maturity of the digital ad market,” noted Hillside Partners, an investment firm specializing in technology companies.

source: business.inquirer.net

China, Singapore to allow direct trading between currencies

SINGAPORE—China and Singapore have agreed to allow direct trading between each other’s currency, Singapore’s central bank said Tuesday.

The move, along with other agreements on financial cooperation, is expected to bolster Singapore’s status as a leading offshore trading center for the Chinese yuan, officially called the renminbi(RMB).

“China and Singapore will introduce direct currency trading between the Chinese yuan and Singapore dollar,” the Monetary Authority of Singapore (MAS) said in a statement, adding that details will be announced separately.

The statement was issued after a meeting between senior officials from both countries led by Singapore Deputy Prime Minister Teo Chee Hean and visiting Chinese Vice Premier Zhang Gaoli.

China will also grant Singapore-based investors a 50 billion yuan ($8.2 billion) investment quota under its Renminbi Qualified Foreign Institutional Investor program, MAS said.

This would allow investors based in the city-state to use the yuan to invest in Chinese stocks and bonds.

The program “will help to diversify the base of investors in China’s capital markets and promote adoption of the RMB for investment”, MAS said.

Chinese institutional investors will also be allowed to use the yuan to invest in Singapore’s capital markets.

“The new initiatives will further promote the international use of the renminbi through Singapore,” the MAS said.

Its managing director Ravi Menon added: “Financial ties between the two countries have deepened considerably and Singapore is well placed to promote greater use of the RMB in international trade and investment in the years to come.”

China’s rise as the world’s second-biggest economy has seen the yuan take on a bigger role in international financial markets.

Britain last week said that direct trading between the yuan and the British pound will be allowed.

China also has similar direct trading arrangements for the yuan with the US dollar, the Japanese yen and the Australian dollar.

source: business.inquirer.net

Asian shares mixed ahead of US jobs data

HONG KONG – Asian markets were mixed in cautious trading on Tuesday as investors awaited the release of delayed US September jobs data later in the day.

The dollar edged up against the yen, returning to its upward trend after this month’s Washington standoff over the debt ceiling and budget had sent investors running to the Japanese unit.

Tokyo rose 0.13 percent, or 19.68 points, to 14,713.25 thanks to the weakening yen, while Sydney climbed 0.40 percent, or 21.3 points, to 5,373.1. Seoul added 0.15 percent, or 3.11 points, to end at 2,056.12.

However, Shanghai fell 0.83 percent, or 18.59 points, to end at 2,210.65 and Hong Kong lost 0.52 percent, or 122.16 points, to end at 23,315.99.

“Market participation levels are likely to remain low until data can help confirm the state of the US economic recovery,” said Hiroichi Nishi, general manager of equities at SMBC Nikko Securities.

With last week’s global rally – fuelled by the US deal to reopen the government after 16 days and avert a devastating default – out of the way, attention has turned back to economic numbers, with the non-farm payrolls figures in focus.

They had been due out at the beginning of the month but were put off because of the US government shutdown. Traders will pore over them for clues about the state of the US economy.

However, Kathy Lien, managing director at BK Asset Management, said there would likely be a cautious reaction to a strong report because it predates the shutdown, which likely depressed hiring.

She added that if jobs growth misses expectations, “the dollar could be in even more trouble because October payrolls are expected to be much weaker.”

Economists say there is a good chance the US Federal Reserve will delay winding down its stimulus program – which depressed the value of the dollar – until possibly the new year.

On currency markets, the dollar was changing hands at 98.34 yen in the afternoon compared with 98.15 yen in New York on Monday, while the euro fetched $1.3674 and 134.49 yen compared with 1.3681 and 134.26 yen.

Wall Street was unable to provide a strong lead as investors took a breather after last week’s strong gains.

The Dow was flat and the S&P 500 edged up marginally to another record high, while the tech-rich Nasdaq added 0.15 percent.

In oil trade, New York’s main contract, West Texas Intermediate for delivery in November, fell 80 cents to $98.42 a barrel, extending its slide after hitting three-month lows late Monday. However, Brent North Sea crude for December gained 22 cents to $109.86.

Gold cost $1,310.44 at 0841 GMT compared with $1,315.41 on Monday.

In other markets:

– Taipei was virtually unchanged, dipping 1.05 points to 8,418.27.

Taiwan Semiconductor Manufacturing Co. rose 1.36 percent to Tw$111.5 while Chunghwa Telecom fell 1.95 percent to Tw$90.6.

– Wellington rose 0.61 percent, or 29.23 points, to 4,831.79.

Fletcher Building was up 1.37 percent at NZ$9.64 and Air New Zealand added 1.92 percent to NZ$1.59.

– Manila ended flat, edging up 6.04 points to 6,603.60.

Ayala Land fell 0.15 percent to 30.60 pesos and its parent Ayala Corp. shed 0.57 percent to 612 pesos.

source: business.inquirer.net

Dollar sinks in Asia on US debt fears

TOKYO – The dollar fell in Asia Monday as investors fear a US budget deadlock in Washington could continue past a mid-October deadline to raise the country’s borrowing limit and cause a devastating default.

The greenback bought 97.08 yen in Tokyo, against 97.47 yen in New York Friday afternoon.

The euro was at $1.3567 and 131.76 yen, compared with $1.3557 and 132.14 yen.

Traders are buying the safe-haven yen on concerns US lawmakers – whose face-off has forced a government shutdown – will not strike a budget deal before October 17, when the government runs out of cash to pay its bills and could in turn default.

A similar showdown in 2011 saw the borrowing limit raise at the last minute but not before global stock markets tumbled while the crisis caused the downgrade of Washington’s sovereign debt rating.

US Treasury Secretary Jack Lew warned Sunday that Congress was “playing with fire” as Republican House leader John Boehner said the party would not raise the US debt ceiling without spending cuts.

“If anything both sides have become more entrenched in their positions, implying that any agreement on raising the debt ceiling… also looks out of reach,” Credit Agricole said.

“Market reaction so far has been relatively muted in the expectation of an agreement but such hopes may prove optimistic,” it added.

The government shutdown, which is entering its seventh day, has also affected the release of US economic data with no clarity on when key non-farm payrolls data, originally due out last week, will be published.

source: business.inquirer.net

US stocks fall for a 4th day

NEW YORK—Wall Street couldn’t shrug off doubts about the US economy and government gridlock on Tuesday.

Mixed economic reports and concern about a government shutdown dragged stocks lower in the final half-hour of trading. They had been positive most of the day.

The modest losses extended the losing streak for the Standard & Poor’s 500 index to four days. It was the longest run of declines in a month. The Dow Jones industrial average also dropped for a fourth straight day.

Investors struggled with conflicting news about the economy on Tuesday. One report showed that home prices in July rose the most in more than seven years. Another showed that Americans’ confidence in the economy slipped in September.

Investors are searching for direction after the Federal Reserve’s surprise decision last Wednesday to keep its stimulus program intact. They had expected a reduction in the Fed’s $85 billion in monthly bond purchases. Investors are now parsing economic reports and comments from Fed officials to gauge the central bank’s next move.

Some are also nervous about political gridlock in Washington. They were concerned that the federal government could shut down because Washington lawmakers appear to be making little progress in budget talks.

“A government shutdown starting next week is looking increasingly likely,” said Jim Russell, a regional investment director at US Bank. “That will not be welcomed by the capital markets.”

But Brad Sorensen, director of market and sector research at Charles Schwab, thought that worries about a government shutdown would ultimately be short-lived.

“Investors are becoming a little bit immune to the games that Washington has started to play,” Sorensen said. “Investors with a stronger stomach should probably buy the dip.”

Stocks, for example, plummeted in the summer of 2011 as lawmakers wrangled about raising the debt ceiling. The market also sagged in October last year before the Presidential elections, on concerns that a divided government would be unable to agree on tax reform. Each time though, backed by the Fed’s economic stimulus, the market came back stronger.

After falling 2 percent in October of last year, the Standard & Poor’s 500 index rose for seven straight months, gaining 15 percent.

On Tuesday, the Dow closed down 66 points, 0.4 percent, to 15,334. The S&P 500 index fell four points, or 0.3 percent, to 1,697. The Nasdaq composite, however, edged up three points, or 0.1 percent, to 3,768.

Stocks edged lower in early trading before moving modestly higher in the late morning and afternoon. Those gains then fizzled out at the end of trading.

Phone company stocks were the biggest decliners among the 10 industry groups that form the S&P 500. Industrial stocks were the biggest gainers.

Before the market opened, a survey showed that home prices rose the most since February 2006. A revival in housing has been one of the bright spots for the economy.

In another key economic gauge, the Conference Board, a New York-based private research group, said that its consumer confidence index dropped to 79.7 in September, down from August’s 81.8.

Consumers’ confidence is closely watched because their spending accounts for 70 percent of US economic activity. Confidence has grown since the Great Recession, but it hasn’t hit a reading of 90, which typically accompanies a healthy economy.

They S&P 500 index is just 28 points below its all-time high reached last Wednesday, when investors were initially thrilled that the Fed extended its economic stimulus. Since then, the market has fallen each day as doubts emerge about the outlook for the economy, and budget negotiations.

In government bond trading, the yield on the 10-year Treasury note rose fell as investors bought bonds. The yield dropped from 2.70 percent late Monday to 2.66 percent, its lowest level in six weeks. The yield on the note is a benchmark for rates of consumer loans.

Among stocks making big moves:

— Software company Red Hat fell $6.20, or 12 percent, to $46.73 after it reported lower-than-expected quarterly billings and issued disappointing revenue forecasts.

—Carnival fell $2.86, or 8 percent, to $34.54 after the cruise ship operator warned revenue could drop more than its prior forecast.

— Applied Materials, a manufacturer of chip-making equipment, rose $1.45, or 9 percent, to $17.45 after it agreed to acquire a rival.

— Facebook rose $1.26, or 3 percent, to $48.45 after Citigroup upgraded the company’s stock to a “buy” recommendation from “neutral.” Facebook should continue to grow, helped by increasing advertising revenue contributions from its mobile website, Citigroup said.—Steve Rothwell

source: business.inquirer.net

Dollar edges up amid speculation about US economy

TOKYO – The dollar edged up on Monday as trading remained cautious amid speculation about the timing of an end to massive US stimulus plans.

The dollar gained to 98.49 yen in morning Asian trade from 98.16 late Friday in New York.

The euro bought $1.3202, down from $1.3218, while the single currency was trading at 130.09 yen against 129.82 yen.

US financial markets are closed Monday for the Labor Day federal holiday.

“The market is paying more attention to US economic indicators than Syria,” said Daisuke Karakama, market economist at Mizuho Bank’s forex division.

“Especially, the market is focusing on US jobless figures to be released on Friday, ahead of the upcoming FOMC meeting,” Karakama said.

“Nervous trading is expected during the week as we need to pay attention to a lot of things,” he added.

US consumer spending sputtered in July amid weak income growth, according to Commerce Department data released Friday.

The new data cast a cloud over speculation that the Federal Reserve will begin to reduce its $85 billion-a-month bond-buying programme this year.

Concerns about the strength of the major economic indicators in the third quarter could convince the Fed to delay the move, which could come as soon as its September 17-18 monetary policy meeting.

source: business.inquirer.net

Peso falls as excitement over investment grade rating eases

MANILA, Philippines—The peso fell on the first trading day after the Lenten break as the euphoria over the Philippines’ attainment of an investment grade eased.

The local currency closed at its intraday low of 40.84 against the US dollar on Monday, down by 4 centavos from the finish of 40.80:$1 on March 27.

Intraday high hit 40.75:$1. Volume of trade reached $530.4 million from $1.14 billion previously.

Traders said the volume of trade eased and demand for the peso tempered as the foreign exchange market felt downbeat following the Lenten break.

Last Wednesday, the last trading day before the break, the market was lifted by the announcement that Fitch Ratings gave the Philippines its first investment grade from a major international ratings firm.

Traders said fund owners would look for fresh leads in the coming days to guide their investment decisions.

source: business.inquirer.net