PH stock index slides below 7,000 as investors avoid risk

pse.com.ph photo

MANILA, Philippines -The local stock barometer slid by 3.81 percent to close below the 7,000-mark on Thursday as high risk aversion across the region negated the favorable impact of a much stronger-than-expected Philippine first quarter growth data.

The main-share Philippine Stock Exchange lost 275.22 points to close at 6,953.35, marking the worst single-day bloodbath in two years.

The announcement of a 7.8 percent first quarter Philippine gross domestic product (GDP) initially pared down index losses to about 30 points from over 100 points before the GDP news, but the index again fell sharply afterwards.

Manny Cruz, chief strategist at Asiasec Equities Inc., said it seemed that some large funds were dumping stocks from emerging markets – particularly TIP or Thailand-Indonesia-Philippines and Mexico – and likewise selling out of Japan to shift to US dollars on valuation concerns.

As of the local market’s closing, the main-share Japanese stock index Nikkei 225 has slumped by over 5 percent.

The peso depreciation against the US has likewise dampened sentiment on local equities.

Value turnover at the local stock market amounted to P16.86 billion.  There were 160 decliners that overwhelmed 15 advancers while 38 stocks were unchanged.

The biggest decliners among PSEi stocks were: Jollibee (-7.28 percent), ICTSI (-6.45 percent) and ALI (-6.29 percent).  Metrobank, SMC and URC were all down by over 5 percent while SMIC, AEV, EDC and AGI all tumbled by over 4 percent.

Most local stocks also tumbled ahead of the MSCI index realignment which takes effect on Friday.