PSEi falls amid concerns over deepening US-China trade spat
By Arra B. Francia, Senior Reporter
LOCAL stocks slipped on Friday along with the rest of the world as worries over the deepening US-China trade spat weighed on local investor sentiment.
The benchmark Philippine Stock Exchange index (PSEi) fell 0.73% or 56.94 points to close at 7,747.09 yesterday. The broader all shares index likewise slumped 0.57% or 27.41 points to 4,781.85.
“Too many bad reasons in a day to sell the market down in the Philippines. On the positive note, these were all developments happening outside the country,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.
Mr. Limlingan noted more companies are suspending relations with Chinese tech giant Huawei after the United States government’s ban. Japanese firms Panasonic and Toshiba have been the latest to withdraw shipments to Huawei.
Amid the ban, no new negotiations have been scheduled for the US and China, escalating tensions between two of the world’s largest economies.
Alongside its trade war with China, the US is reportedly considering an increase in troops in the Middle East to protect American military personnel there. This comes amid reports that Iran is planning attacks by its proxy forces on American troops in the region.
Mr. Limlingan also noted developments on Brexit, the crude oil falling over six percent to below $58 per barrel, and poor macro data from Germany.
“A result of those above: US Treasuries (UST) surged as investors rush to buy hedges. 10-year UST yield fell to below 2.30% overnight, ending at 2.32% (now), its lowest since 2017,” Mr. Limlingan explained.
Philstocks Financial, Inc. also attributed the market’s decline to weakness abroad, saying in a market note: “The decline at Wall Street caused by dismal US May factory output data and worsening US-China relations spilled over to our local bourse today.”
The Dow Jones Industrial Average plummeted 1.11% or 286.14 points to 25,490.47. The S&P 500 index slid 1.19% or 34.03 points to 2,822.24, while the Nasdaq Composite was down 1.58% or 122.56 points to 7,628.29.
Back home, services was the lone counter that ended in positive territory, after it gained 0.29% or 4.80 points to 1,657.47. The rest declined, led by property which tumbled 1.32% or 55.83 points to 4,172.31.
Industrial retreated 1.29% or 146.44 points to 11,215.73; mining and oil dropped 0.49% or 35.36 points to 7,197.18; holding firms shed 0.44% or 32.29 points to 7,376.01, while financials dipped 0.31% or 5.36 points to 1,706.79.
Turnover stood at P7.42 billion after some 2.91 billion issues switched hands, slightly higher than the previous session’s P7.20 billion.
Decliners swamped advancers, 125 to 73, while 44 names ended flat.
Foreign investors have been on selling mode for the 15th straight session at P736.08 million, more than four times Thursday’s figure of P177.41 million.
