MANILA, Philippines -- The bloodbath in the local stock market failed to ebb Tuesday as stocks tracked heavy sell-offs on Monday in Asian and European markets, analysts said.

The Philippine Stock Exchange index (PSEi) plummetted 173.89 points or 5.51 percent to 2,978.41 as of 12:00 noon, its seventh session of straight losses and its worst finish in five months or since Aug.17, 2007 when it settled at 2, 884.34.

Tuesday's 173-point loss was its biggest point drop since Aug. 16, 2007 when the index finished down 6 percent as troubles in the US housing and credit markets began to worry investors. But during the day, the stock index plunged by as much as 198 points, almost its biggest point loss since August 1997 when it tumbled 212.06 points.

The US is not just the biggest market for Philippine exports, it is also home to millions of overseas-based Filipinos whose remittances help prop up the domestic economy.

Around eight million Filipinos, or roughly a tenth of the population, work abroad and send home at least $1 billion every month. Their earnings fuel consumer spending in this Southeast Asian nation.

The all-share index fell 96.93 points or nearly 5 percent to 1,855.39.

Decliners overwhelmed advancers 150 to six, while 11 stocks were steady.

Volume traded totaled 3.0 billion shares valued at P4.4 billion. This does not include two more block sales involving about 25.9 million shares in Manila Electric Co. or Meralco, valued at P2.1 billion. On Monday, two block sales involving Meralco shares worth P6.8 billion were made through the stock market.

Philippine stocks mirrored the bloodletting in Asian and European bourses Monday as global investors remained doubtful of a $145 billion economic stimulus plan announced by President George Bush that calls for tax relief to boost consumer spending and help thwart an economic recession, news wires reported.

US markets were closed for a holiday on Monday. It resumes trading tonight.

"The market is down because we are playing catch-up with what happened in the Asian and European markets yesterday. At the same time, most investors are shying away from the market as they await the reaction of the US market on the stimulus economic package by the US government," Ron Rodrigo, head of research at DBP Daiwa Securities said.

"This is basically disappointment over the proposed fiscal package to soften the impact of a US recession," Campos Lanuza & Co. said in a daily comment.

"It does not solve the problem. The US is suffering from twin deficits -- fiscal and trade. A fiscal stimulus may help consumers but in terms of businesses and property or the subprime problem, it?s not going to do a lot," the broker added.

"The (Philippines' main) index may hit 2,800 points at which level the selling may stop. We can't expect the market to keep going down by 3.0 percent or more everyday. It has become extremely oversold," said Jose Vistan Jr., research director at AB Capital Securities.

The index has fallen nearly 15 percent over the past seven sessions and is down almost 18 percent so far this year.

"Investors are rushing to the emergency exits as valuations of stocks in developed markets have gone down substantially. Suddenly emerging markets' valuations look expensive," said Conrado Bate, president of online stockbroker CitisecOnline.

The country's biggest companies were heavily sold down.

Philippine Long Distance Telephone Co. (PLDT), the country's biggest company by market value, fell P205.00 or 7.4 percent to P2,565.00. The stock hit a low of P2,520.00, its weakest since August 22 when it sank to P2,510.00.

Ayala Land Inc., the country's biggest property developer, lost 75 centavos or 5.4 percent to P13.25.

Metropolitan Bank & Trust Co., the country's biggest bank by assets, was down P1.00 or 2.3 percent at P42.00.

SM Investments Corp., the country's second-largest conglomerate, fell P20.00 or nearly 7.0 percent to P267.50. SM said Monday its retail and banking businesses chalked a net profit in 2007 of an estimated P12 billion from P10.6 billion in the previous year.

Philex Mining Corp., the country's biggest gold and copper miner, lost 70 centavos or 8.1 percent to P8.00.

Meralco, the country's biggest power distributor, fell P1.50 or 2.1 percent to P70.00.

Food and drinks conglomerate San Miguel Corp.'s A-shares, reserved for Filipinos, fell P1.00 or 1.8 percent to P54.00. Its B-shares, which have no ownership restriction, lost P1.00 or 1.8 percent to P54.50.

($1 = P41.48)