PSEI sinks to 6,600 as foreign funds continue exodus
The local stock barometer sank to the 6,600 level on Tuesday as foreign funds continued to pull out of emerging markets following heightened global political risks and ahead of further interest rate increases in the United States.
The main-share Philippine Stock Exchange index (PSEi) lost another 55.47 points or 0.83 percent to close at 6,658.66, paring intraday losses but nonetheless slipping for the fourth straight session.
Risk appetite was low across regional markets after Russia’s ambassador to Turkey was assassinated a day before a key meeting on Syria involving Turkey, Russia and Iran. Russia and Iran back the Syrian regime while Turkey backs the opposition. In Berlin, 12 people died as a truck rammed into a crowded Christmas market.
Meanwhile, Japan’s central bank kept its current monetary policy unchanged.
At the local market, the PSEi is now trading 292.42 points or 4.2 percent below its end-2015 finish of 6,952.08.
“Many are concerned that the market is in freefall. I think 6,500 is in sight,” said BPI Securities president Michaelangelo Oyson. However, Oyson said the market was getting “close to the bottom” with volume thinning out.
The day’s decline was led by the holding firm and services counters, which slid by more than 1 percent. The financial, industrial and mining/oil counters also slipped. The property index rose by a meager 0.18 percent.
Heavy selling by foreign investors continued to batter local equities. Some P1.37 billion worth of foreign-managed funds flowed out of the local market on Tuesday.
When US interest rates are on the rise, emerging market assets become less attractive while local currencies are also under pressure to depreciate.
At the local market, value turnover amounted to P6.78 billion. There were 132 decliners that overwhelmed 51 advancers while 42 stocks were unchanged.
Telecom giant PLDT was among the most battered blue chip for the day, sliding by 3.7 percent, while BDO, SM Investments, Aboitiz Equity and JG Summit all dropped by more than 2 percent.
Conglomerate Ayala Corp. and infrastructure holding firm Metro Pacific Investments slipped by more than 1 percent while GT Capital and Universal Robina Corp. also contributed to the decline.
One notable decliner outside the PSEi was newly listed Shakey’s Pizza, which slipped by 3.34 percent as some initial public offering (IPO) investors pocketed gains.
On the other hand, property firm Megaworld was unscathed as it gained 4.55 percent. Banking stocks Metrobank, BPI and Security Bank also bucked the downturn, all rising by more than 1 percent.
Ayala Land and Globe Telecom also firmed up.
