MANILA, Philippines — Asian stocks, including the Philippines, tumbled yesterday after data showed China’s economy at its slowest pace in four decades last year, though traders remain hopeful about the country’s outlook as it emerges from years of debilitating zero-COVID measures.
Hong Kong, which had piled on more than nine percent so far this year, lost more than one percent, while Shanghai, Sydney, Seoul, Singapore were also in negative territory. Wall Street was closed Monday for a public holiday.
Manila also ended in negative territory with the Philippine Stock Exchange index (PSEi), the main composite index, retreating by 31.44 points or 0.45 percent to settle at 7,014.04.
The sectoral gauges were mixed with industrial, holding firms, financials and mining and oil ending in positive territory.
Yesterday’s active stocks were likewise mixed, but several issues still managed to end in positive territory.
Total value turnover reached P10 billion. Market breadth was negative with 111 losers and 77 gainers while 38 issues were unchanged.
Luis Limlingan of Regina Capital said investors took their profits after the index breached the 7,000 level on Monday and ahead of the resumption of trading in the US after the observance of Martin Luther King Day held every Jan. 16.
Meanwhile, analysts said China’s three percent expansion was the worst since 1976 – excluding pandemic-hit 2020 – and sharply down from the previous year as widespread lockdowns and other containment policies hammered business activity.
However, it beat the 2.7 percent forecast and the fourth-quarter reading also topped estimates, while a healthy reading on retail sales provided extra cheer.
There is now growing optimism that the reopening that started last month will fuel a strong rebound this year and help support the global economy as central banks try to avert a recession caused by soaring inflation and interest rate hikes.
“Looking forward, we expect to see a sustained economic recovery in 2023 as a result of reopening and policy stimulus,” said Chaoping Zhu, of JP Morgan Asset Management.
Regional markets, however, struggled to maintain the strong momentum that has characterized trading at the start of the year that has been powered by China hopes and signs that the battle against inflation appears to be turning in central banks’ favor. – AFP