Stocks close lower on rising global tension

Philippine stocks sank Friday as geopolitical issues around the globe prompted investors to stay on the sidelines, an analyst said.

The benchmark Philippine Stock Exchange index (PSEi) closed down 1.08 percent, or 74.87 points, to 6,880.34 on Friday while the broader shares index also sank 0.90 percent, or 37.40 points, to 4,129.10.

Reports that the United States authorized air strikes against Iraq and the ongoing Ukraine crisis spooked investors in the Philippines and across the region, First Grade Finance Inc. managing director Astro del Castillo said in an interview.

“Investors are seeing how these geopolitical issues would affect prices of oil. It may also put pressure on the cost of basic and goods and services,” Del Castillo said.

He added that investors were closely monitoring inflation readings, which showed a 4.9 percent spike in July.

Holding companies led the decline among subsectors, showing a drop of 1.56 percent. This was followed by property firms, down 1.41 percent.

A total of 1.2 billion shares valued at P7.16 billion changed hands yesterday, data from the PSE showed. Losses were broad-based with 126 decliners versus 40 gainers while 52 companies closed unchanged, the data showed.

Most actively traded was Philippine Long Distance Telephone Co., which sank 0.46 percent to P3,000 a share. PLDT announced a day earlier that it was taking a 10-percent stake in Berlin, Germany-based Rocket Internet for about P19.6 billion.