By Madelaine B. Miraflor
Philippine stocks capped the week with its worst performance yet — with the benchmark index not only falling for a seventh session to its lowest in over 17 months, but also sinking below the 7,000 level for the first time in a year.
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Yesterday, the benchmark Philippine Stock Exchange index (PSEi) went further down by 34.95 points, or 0.49 percent, to 7,063.20, while the All Shares index dipped by 22.15 points, or 0.51 percent.
During the morning session, the index sank to 6,925 level.
Luis Limlingan, managing director at Regina Capital Development Corp., said the PSEi's 6.34 percent decline for this week was the "biggest in recent trading history." In terms of market capitalization, the PSE lost approximately $22.839 billion during the week, according to a computation made by Bloomberg.’
"Local issues were sold down heavily in the morning due to a number of reasons. US stocks closed solidly lower on Thursday, with major indexes suffering one of their worst sessions of the month and the Dow Jones Industrial Average extending its losing streak to an eighth day," Limlingan said.
Among the subsectors, services had the steepest fall of 1.15 percent, losing 15.90 points to close at 1,370.78, while holding firms went down 69.90 points, or 0.99 percent to 6,988.38.
Financials also erased 13.24 points, or 0.74 percent to 1,775.49, followed by industrial, which retreated by 58.81 points, or 0.57 percent to 10,242.62.
Mining and oil, on the other hand, gained 119.88 points, or 1.26 percent to 9,649.55, while property increased by 22.20 points, or 0.65 percent to 3,444.18.
This was after Mining Industry Coordinating Council (MICC) cleared 23 of 27 mining companies that former Regina Paz Lopez wanted to either close down or suspend, easing uncertainty about potential supply disruptions at one of the world’s top nickel ore suppliers.
On Friday, Total value turnover stood at R8.05 billion, while decliners outnumbered losers, 129 to 76.
During the previous trading, the decision of Bangko Sentral ng Pilipinas (BSP) to call for another rate hike failed to uplift local investor, with PSEi still sinking by 163.47 points or 2.25 percent to close at 7,098.15.
It was the mark of PSEi's entry back into the market territory after falling by more than 20 percent since hitting its highest level of 9,058.62 on Jan. 29, 2018 trading.
Fritz Ocampo, chief investment officer at BDO Unibank, Inc., said in a Bloomberg report on Thursday, which was published in Manila Bulletin, said "we may have not seen the bottom yet" and that "any rally could be short-lived because international investors are unwinding out of emerging markets.”
“The market needs a clear announcement to calm nerves,” she added.
For his part, Jervin de Celis, anayst at Timson Securities, said the PSEi is still bearish as major support levels have been broken down due to the absence of strong local catalysts.
"Investors are also worried about the escalating trade tension between China and the US. The Eurozone and India also announced their plan to impose tariffs on some US goods and I think this smothers market sentiments. Foreign investors are still on a selling spree as risky assets become less attractive compared to safer instruments like Bonds," De Celis said.