Stocks plunge amid fears over Omicron variant

Published December 1, 2021, 4:29 PM

by James A. Loyola

The Philippine Stock Exchange index registered its second biggest single day drop for the year and breaking below the 7,000 level as share prices plunged on fears raised by the Omicron COVID-19 variant.

The main index fell 253.82 points or 3.53 percent to close at 6,947.06 on Wednesday, Dec. 1, the Property sector led the retreat across the board with a loss of 5.01 percent.

Volume was hefty at 1.37 billion shares worth P14.43 billion as losers swamped gainers 165 to 40 with 42 unchanged.

“Philippine shares suffered one of the biggest losses of the year as Omicron fears continue to rule market sentiment,” said Regina Capital Development Corp. Managing Director Luis Limlingan.

He noted that, “Regional equities also plunged as shares of airlines, cruise lines, and lodging companies considered to be some of the most exposed to virus-related disruptions each sank.”

“Investors also reacted to Fed Chair Powell’s latest remarks before the Senate Banking Committee, wherein Powell said the central bank could speed up its tapering process to end sooner than previously telegraphed in the face of rising inflationary pressures,” said Limlingan.

MB/ FILE PHOTO

Philstocks Financial Senior Supervisor for Research Japhet Tantiangco said “The local bourse plunged as COVID-19 worries continued to weigh on sentiment.”

He explained that, “Investors digested Moderna, Inc.’s expectation of the existing COVID-19 vaccines being less effective against the Omicron variant. Adding to the concerns is Bloomberg’s COVID Resilience Index in which the Philippines remained at the bottom.“

“The local index fell below key support at 7,000 as more cases of the new Omicron variant are detected in more countries and governments put international travel restrictions back in place to contain the spread,” said AB Capital Securities.

It added that, sentiment was also affected by the government’s decision to push back the plan to allow fully-vaccinated tourists into the country, which was supposed to take effect today.

 
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