Market down on last trading day of 2016

The year 2016 ended on a sluggish note for the stock market, losing 1.6 percent as the financial market closed on Thursday and declining for the second straight year.

Yesterday, the financial markets were closed for the long New Year turnover break.  Markets will resume trading on Tuesday, Jan. 3.

On Thursday, the last trading day of 2016, the Philippine Stock Exchange index lost 5.8 points or 0.09 percent to close at 6,840.64 ahead of the holiday break.

In 2015, the PSEi also closed lower by 3.85 percent.

From 2009 to 2014, the local stock barometer nearly quadrupled to 7,230.57 on the back of the Philippine turnaround and investment grade rating story.

In July 2016, the PSEi breached the 8,000 mark after the conduct of peaceful and credible elections but pulled back sharply since the jitters over US interest rates and US elections escalated alongside domestic political noise.

“As we turn to 2017, we predict that global growth should stabilize, not stagnate. Tightening labor markets should place modest upward pressure on otherwise low inflation. But further monetary stimulus (like negative interest rates) will prove unproductive in spurring growth,” said Luis Gerardo Limlingan, managing director at local stock brokerage Regina Capital.

After raising the funds rate by 25 basis points at its December meeting, the US Federal Reserve is now widely expected to hike interest rates three times in 2017.

“Many developed economies are likely to struggle to consistently achieve 2 percent core inflation over the medium term,” Limlingan said.