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Market flat amid BoP data woe

Dampening sentiment was Bangko Sentral ng Pilipinas’ report that the overall balance of payments reverted to a deficit for September



Aerial shot shows people waiting in line for nucleic acid testing at a sampling site during the latest Covid-19 outbreak in Yinchuan, northwest China’s Ningxia Hui Autonomous Region. Markets are keenly following the developments in China which may derail recovery momentum in the region. / Feng Kaihua/Xinhua

It was a dull day at the bourse yesterday but market-on-close buying of index heavyweights lifted the index into positive territory despite trading in the red for most of the day.

AB Capital Securities Inc. listed Ayala Corp, International Container Terminal Services Inc., Shoemart, Jollibee Foods Corp, and AC ENergy Corp. as having led the barometer shares’ rise by 40.56 points to 7,252.10.

Dampening sentiment was Bangko Sentral ng Pilipinas’ (BSP) report that the overall balance of payments (BoP) reverted to a deficit for September.

Posting a deficit of $412 million, the latest BoP figure is a turnaround from the recorded $2.10 billion in September 2020.

The BSP traced this development to the outflows emanating largely from the national government’s debt service payment for foreign currency obligations.

In the first nine months of the year, the BoP likewise posted a reversal with a $665 million deficit compared to the listed $6.88 billion surplus in the same period year-ago.

“Based on preliminary data, this cumulative BoP deficit was partly attributed to a wider merchandise trade deficit and lower net foreign borrowings by the NG compared to the same period last year,” the central bank explained.

The latest BoP position reflected a decline in the final gross international reserves or GIR levels with only $106.6 billion as of end-September 2021 from $107.96 billion as of end-August 2021.

Fresh outbreak a concern
Asian markets mostly rose on Tuesday following fresh records on Wall Street, with healthy corporate earnings overshadowing ongoing concerns about inflation, while progress in Washington on Joe Biden’s big-spending economic plans also provided support.

However, a fresh virus outbreak in China, which has left tens of thousands of people in lockdown, revived concerns about the world’s number two economy and authorities’ zero-Covid policies.

The S&P 500 and Dow both ended at new peaks, with tech firms lifted by a surge in electric car maker Tesla to the trillion-dollar mark ahead of the release of profit reports this week from business titans including Apple, Amazon, Microsoft and Twitter.