Stocks drop on US recession fears

The local stock market dropped further on growing fears that the US will go into recession.

The main index fell 70.30 points or 1.07 percent to close at 6,496.50 as the Mining and Oil sector led the retreat with only the Industrial counter managing to hold its ground. Volume was stable at 558 million shares worth P7.31 billion as losers outnumbered gainers 99 to 65 with 40 unchanged.

Philippine Stock Exchange index (PSEi)

“Philippine shares extended their drop as investors responded to data that elevated concerns of a looming recession and looked ahead to a slate of Federal Reserve speakers scheduled for Friday,” said Regina Capital Development Corporation Managing Director Luis Limlingan.

He noted that , “The disappointing retail sales report suggested inflation is hitting consumers more than expected, fueling investors concerns that consumer spending is slowing, a sign that the economy is weakening.“

Philstocks Financial Assistant Research Manager Claire Alviar said “The local bourse dropped due to growing recession fears in the US following the disappointing US retail sales in November. “

“Moreover, investors also took some gains on the last trading day of the week to avoid any uncertainties over the weekend,” she added.