PSEi falls below 6,600
THE LOCAL stock barometer slid below the 6,600 support level on Friday as jitters over China’s foreign exchange and stock markets reverberated across global markets.
The Philippine Stock Exchange index lost 43.45 points or 0.66 percent to close at 6,575.43. For the first trading week of 2016, the main index lost a total of 376.65 points or 5.42 percent – a gloomy curtain-raiser to what many investors expect to be a very challenging year ahead.
The Shanghai index rebounded by 1.97 percent on Friday as state-owned funds reportedly picked up oversold stocks. China has also dropped the circuit-breaker rules which only deepened the market rout following trading suspensions in previous days. Nonetheless, investors are still jittery on China.
“The scale of global spillover from China’s recent policy shifts raises the risk of a reversal in stance in the short-run,” Citigroup said in a research note. “While many focus on the Chinese equity market as the source of global contagion, China’s foreign exchange policy also plays a large role.”
“In this environment of elevated volatility and extreme policy uncertainty, investors should reduce risk exposure,” Citi said.
At the local market, all counters ended in the red but the most battered were the financial and services counters which both slipped by over 1 percent.
Value turnover stood at P5.57 billion. There were over thrice as many decliners for every single gainer in the market.
Local banking giants BDO and Metrobank led the PSEi lower, both declining by over 2 percent while ALI, PLDT, AC and Megaworld all slipped by over 1 percent.
URC, GTCAP, SMIC, Globe, MPI and Meralco also contributed to the day’s decline.
Outside of PSEi stocks, RRHI slipped by 3.56 percent on profit-taking while FLI and Cebu Air also both fell by over 2 percent.
SM Prime, JG Summit and BPI bucked the day’s downturn albeit eking out only modest gains.
Gaming firm LR rose by 1.72 percent in relatively heavy trade.
