Stock prices fell on Wednesday, May 9, as investors fled the markets following geopolitical tensions in the Middle East.
The bellwether Philippine Stock Exchange index shed 0.29% or 22.30 points to close at 7,555.27 on Wednesday. The broader all shares index also dipped 0.19% or 8.84 points to 4,620.49.
“Local equities were affected by (United States) Pres. (Donald J.) Trump’s decision to pull the US out of the Iran nuclear deal as investors took another temporary flight to safety to dollar assets on fresh Mideast geopolitical tension fears and the negative implication on earnings for affected firms worldwide,” PCCI Securities Brokers Corp. Research Head Joseph James F. Lago said in an email.
Analysts noted that this move will strain US’ longstanding alliances, disrupt oil markets and boost tensions in the Middle East.
Mr. Lago also noted that investors had gone bargain hunting in the morning given optimism ahead of first quarter economic growth figures to be released on Thursday.
Sectoral counters were split between gainers and losers.
Financials gave up 1.38% or 26.02 points to 1,860.52. Services plunged 0.93% or 14.22 points to 1,510.72, while holding firms edged 0.14% or 10.53 points lower to 7,600.17.
Meanwhile, industrial inched up 0.38% or 41.61 points to 11,096.08. Property gained 0.31% or 11.18 points to 3,593.21 while mining and oil added 0.12% or 12.29 points to 10,095.22.
The market saw thin trading for the day, with 1.2 billion issues switching hands valued at only P4.96 billion, much lower than the P7.23-billion turnover on Tuesday.
Decliners trumped advancers, 113 to 73, while 59 stocks remained unchanged. Foreign investors remained on selling mode, resulting to net sales of P638.33 million, higher than the P225.77 million recorded in the previous session.
Investors are also awaiting the results of policy meeting of the BSP on Thursday.
PCCI Securities’ Mr. Lago said that the local central bank might do a slight tightening or raise its benchmark rates in a gradual manner in light of rising inflation.
“If it adjusts its policy rates, it will be on a gradual path so that it has room for all of its other tools when inflation pressures eases late in the year or in 2019,” Mr. Lago said. — Arra B. Francia