The benchmark stocks index wiped out all its recent gains as foreigners exited the local bourse in an effort to hedge risks before the monetary policy meetings of central banks.
The Philippine Stock Exchange Index (PSEi) barely held on to 6,500 and ended in a bloodbath as it tumbled by 1.72 percent, or 113.45 points, to 6,501.71.
Likewise, the broader All Shares Index slipped by 1.13 percent, or 42.3 points, to close at 3,710.21.
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A total of 1.13 billion shares worth P6.6 billion changed hands, stock exchange data showed. Foreigners were net sellers, with foreign outflows totaling P1.36 billion.
Although not yet in the bear market, which would require it to fall by at least 20 percent from its recent peak, the PSEi has so far plunged by 13.94 percent from its high of 7,554.68 in October. The local stock barometer made its exit from the bull territory in November following US president-elect Donald Trump’s victory.
Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., explained that investors were weighing risks before the rate-setting meetings of the Bangko Sentral ng Pilipinas (BSP) and the US Federal Reserve on Thursday.
As the PSEi failed to hold 6,550, Colet said its next support level was now 6,400, adding that the market could only bounce back if there was a “positive shift” in the interest rate cut outlook next year.
Analysts surveyed by the Inquirer said the BSP would likely deliver a third rate cut this year amounting to 25 basis points (bps) due to the inflation uptick in November.
BSP Governor Eli Remolona Jr. previously said cumulative rate cuts worth 100 bps were possible in 2025.
Banks saw the steepest decline as index heavyweight Bank of the Philippine Islands dipped by 4.67 percent to P128.5 per share.
International Container Terminal Services Inc. was the top-traded stock as it shed 3.65 percent to P385.4, followed by Ayala Land Inc., down 2.1 percent to P25.7; BDO Unibank Inc., down 0.47 percent to P149; and SM Prime Holdings Inc., down 1.15 percent to P25.9 each.
Other actively traded stocks were SM Investments Corp., down 1.11 percent to P890; PLDT Inc., flat at P1,260; Monde Nissin Corp., down 7.5 percent to P7.4; Universal Robina Corp., down 2.99 percent to P74.5; and San Miguel Food and Beverage Inc., down 0.19 percent to P51.8 per share.
Losers overpowered gainers, 124 to 65, while 51 companies closed unchanged, stock exchange data also showed. INQ