Global recession fears weigh down bourse
All sectors were in red territory, with the Industrials leading the losers with a 3.53 percent drop, followed by the Properties, down by 3.35 percent, and Mining and Oil by 2.64 percent
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Daily TribuneAll sectors were in red territory, with the Industrials leading the losers with a 3.53 percent drop, followed by the Properties, down by 3.35 percent, and Mining and Oil by 2.64 percent
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The stock market barometer plunged by 170.57 points, or 2.58 percent, to close at 6,434.73 as fears about recession hitting the world’s biggest markets looms.
All sectors were in red territory, with the Industrials leading the losers with a 3.53 percent drop, followed by the Properties, down by 3.35 percent, and Mining and Oil by 2.64 percent.
No index members gained, with Gokongwei-led Universal Robina Corporation at the bottom, dropping by 8.7 percent, according to Philstocks Financial Inc. research analyst Claire Alviar.
She attributed the bourse’s performance fall to the disappointing jobs report, raising recession fears following the Federal Reserve’s decision to keep interest rates unchanged.
Further, she said the inflation rate in July could potentially be higher than the preceding month’s figure, and the government’s target of 2 percent to 4 percent affected the sentiment.
“In Asia, Japan’s Nikkei has erased all its gains this year and is now trading at a loss year-to-date, while South Korea’s Kospi briefly halted trading after triggering circuit breakers,” Alviar said in a Viber message.
“Japan experienced one of the worst corrections since the recent 1987 crash as many are still digesting the impact of the BOJ raising interest rates,” Luis Limlingan, head of sales at Regina Capital Development Corp., said.
Rizal Commercial Banking Corporation chief economist Michael Ricafort said the 2.58 percent drop is a new two-month low, or since 2 July.
Among the factors he attributed the decline to is the latest sell-off in the US and global stock markets amid some reversals of the carry trades due to the sharp appreciation of the Japanese yen, which he said resulted in some market unwinding of the carry trades financed by the yen.
“[This is] also amid the profit taking in U.S. tech shares over the past two to three weeks; increased geopolitical risks due to increased tensions recently between Israel-Iran/Hamas/Hezbollah/other proxies recently that partly led to the shift [to] safest assets,” he added. The net market value turnover was P5.17 billion.
One hundred seventy-five Decliners outnumbered 34 Advancers, with 45 names unchanged.
The peso closed at P57.9 from a dollar.
There will be no change in the PSE regular index review from July 2023 to June 2024 trading period. In a statement, the bourse said the 30 companies comprising the PSE Index ‘will stay as is’ as present Index members remain to be among the top stocks in terms of market capitalization, liquidity, and free float level.
