THE MAIN INDEX continued to go down on Wednesday as investors erred on the side of caution, with the growing number of coronavirus disease 2019 (COVID-19) cases threatening economic recovery.

The benchmark Philippine Stock Exchange index (PSEi) lost 72.05 points or 1.17% to close at 6,064.26, while the broader all shares index gave up 30.63 points or 0.85% to end at 3,569.09.

Philstocks Financial, Inc. Research Associate Piper Chaucer E. Tan said the PSEi’s decline for the second straight day is likely due to uncertainties emerging from the Philippines’ struggle to contain the virus.

“This recent drop of the PSEi came as the country rethinks its quarantine measures with the continuous rising number of COVID-19 cases,” he said in a text message.

The Department of Health reported 1,951 new COVID-19 cases on Tuesday, 1,464 of which came from Metro Manila, pushing the tally past the 70,000 mark to 70,764 total cases.

The continued spread of the virus is causing worries among  investors of a possible return to stricter quarantine measures. If this happens, businesses will have to close again and take a toll on an already-struggling economy.

“The Philippines now stands as one of (the countries with) the longest and strictest lockdowns in the world. (Returning to strict quarantine measures) could threaten the economy that has only been beginning to restart,” Mr. Tan said.

AAA Southeast Equities, Inc. Research Head Christopher John Mangun also noted there is increased selling pressure from investors amid a lack of catalysts to drive optimism.

“Trading volumes remain low as buyers are hesitant to pick up battered shares. The sentiment is extremely cautious due to the uncertainty in the business environment in the coming months,” he said in an e-mail.

Meanwhile, US stocks rose on Tuesday as a rotation into economically sensitive cyclical stocks reflected optimism that Washington will deliver a new round of stimulus to sustain the US economic recovery from a pandemic-induced recession.

Back home, nearly all sectoral indices closed Wednesday’s session in red territory. Holding firms dropped 124.66 points or 1.92% to 6,355.22; industrials shed 67.47 points or 0.9% to 7,403.52; services trimmed 9.47 points or 0.66% to 1,420.49; financials slid 5.63 points or 0.47% to 1,179.34; and property fell 12.80 points or 0.43% to 2,967.13.

The sole gainer was mining and oil, which added 35.86 points or 0.7% to 5,129.62 at the end of trading.

Value turnover grew slightly to P4.50 billion on Wednesday from P4.37 billion the previous day. Some 3.01 billion issues switched hands.

Decliners outnumbered advancers, 105 against 89, while 35 names ended unchanged.

Net foreign selling declined to P393.11 million from the P582.24 million logged on Tuesday. — Denise A. Valdez

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