THE LOCAL BOURSE tumbled further on Thursday as the faster-than-expected August inflation print continued to roil the market and as global trade tensions further dampened sentiment.
The bellwether Philippine Stock Exchange index (PSEi) plunged 1.46% or 113.56 points to close at 7,638.71 Thursday, September 6.
The broader all-shares index also declined 1.48% or 70.36 points to finish at 4,661.66.
The PSEi dropped by as much as 163 points intraday, hitting a low of 7,552.24. However, last-minute buying activities propped up the benchmark index towards the close.
“Philippine shares continued to be sold with investors still assessing the impact of inflation and whether this would still continue in the succeeding periods,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile message on Thursday. “The performance of regional markets did not help either.”
On Wednesday, the Philippine Statistics Authority reported that headline inflation picked up to 6.4% in August — faster than July’s 5.7% and the highest since March 2009’s 6.6%. This was also well beyond government and market estimates.
The August print brought the year-to-date average to 4.8%, exceeding the government’s 2-4% target for the year.
However, economic managers said they expect inflation to taper off towards the end of the year.
Jervin S. de Celis, Timson Securities, Inc. equity trader, said volatility in emerging markets also pulled down the local bourse.
“[T]he rout in emerging markets is stirring worries among investors about the resilience of these countries to Western catalysts,” Mr. De Celis said in a mobile phone message Thursday, September 6.
Mr. De Celis said markets were also cautious ahead of more tariff hikes expected from the United States.
“That’s dragging market sentiments lower among emerging countries as trade wars threaten global growth,” he added.
All sector counters closed in the red again on Thursday.
Mining and oil posted the biggest loss as the sector plunged 2.85% or 283.06 points to 9,624.78. Holding firms slid 1.93% or 148.85 points to 7,560.38; financials gave up 1.73% or 30.45 points to 1,723.39; property edged down 1.21% or 46.84 points to 3,810.12; industrials dropped 0.87% or 98.47 points to 11,127.86; and services dipped 0.7% or 10.81 points to 1,525.97.
Value turnover stood at P6.71 billion yesterday as 1.17 billion shares changed hands, climbing from Wednesday’s P5.89 billion.
Decliners trumped advancers, 161 to 37, while 41 names closed unchanged. Foreigners logged net sales of P1.02 billion, little changed from Wednesday’s P1.04-billion net outflow.
Meanwhile, on Wall Street, the Dow Jones Industrial Average rose 22.51 points or 0.09% to 25,974.99; the S&P 500 lost 8.12 points or 0.28% to 2,888.60; and the Nasdaq Composite dropped 96.07 point or 1.19% to 7,995.17. — J.C. Lim with Reuters