Stocks plunge as COVID cases worsen

The local stock market suffered a steeper fall as reality sets in on how bad the COVID-19 situation is being handled, raising fears of a reverting to more restrictions in the year-long lockdown.

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The PSEi plunged 176.09 points or 2.62 percent to close at 6,552.46 as share prices fell across the board, led by the Mining and Oil sector.

Volume was higher at 5.56 billion shares worth P9.23 billion as losers reigned at 207 to just 28 gainers and 32 unchanged.

“The local bourse plunged as pandemic worries weighed on sentiment. This comes amid the surge in COVID-19 cases with the OCTA Research Group now projecting 8,000 cases per day by end-March if the rise continues,” said Philstocks Financial Senior Analyst Japhet Tantiangco.

He added that, “The surge in cases and the implementation of additional restrictions such as the curfew in Metro Manila has clouded our economic outlook.”
AAA Equities Head of Research Chris Mangun said “The market collapsed as the possibility of a hard lockdown gets higher and higher as the days go by. Increased selling pressure coupled with a lack of buying at current levels, caused most blue chips to take substantial losses.“

He noted that, “The main index blew through support at 6,600 but was able to hold at 6,500. It recovered slightly towards the close on bargain hunting as selling pressure diminished.”

Mangun said “Second and third liners took bigger hits with more than a dozen issues ending with double-digit percentage losses as the sentiment rapidly deteriorates.”

“Philippine shares tested the 6500 support as the uniformed curfew and surge in cases kept foreign funds at bay. On top of the curfew, liquor bans will take effect starting today in cities such as Quezon City and Paranaque,” said Regina Capital Development Corporation Managing Director Luis Limlingan.

On the other hand, he said “rising reopening optimism in the US and other developed economies continued to encourage the rotation into cyclical stocks.”