Shares fall as gov’t imposes stricter lockdown
Philippine shares closed in the red on Friday following the government’s decision to tighten quarantine restrictions in an attempt to curb the further spread of the coronavirus disease 2019 (COVID-19).
The benchmark Philippine Stock Exchange index (PSEi) dropped 226.3 points or 3.48% to close at 6,270.23 on Friday, while the broader all shares index declined by 107.17 points or 2.65% to finish at 3,934.86.
“The PSEi took a nasty spill today after getting whiff of the news of a renewed tighter lockdown,” COL Financial Group, Inc. Chief Technical Analyst Juanis G. Barredo said in a Viber message. “This forced traders to lighten down positions and review strategies into the interim.”
According to his spokesman, President Rodrigo R. Duterte approved the recommendation of the government’s pandemic task force to put Metro Manila under an enhanced community quarantine beginning Friday next week, Aug. 6, until Aug. 20.
“It may take a few days for the market to fully digest the impact of this news,” Mr. Barredo said.
The announcement came just after Malacañang said on Wednesday that Metro Manila and nearby provinces of Bulacan, Cavite, Laguna and Rizal, or the NCR Plus bubble, will remain under the lighter general community quarantine (GCQ) until mid-August.
The GCQ will now be implemented starting July 31 until Aug. 5. Under the added restrictions, indoor and al fresco dining will be prohibited, and only authorized persons will be allowed to travel to and from the NCR Plus bubble.
“Once again, this would hurt most businesses, particularly the non-essentials as some of them would be prohibited to operate or the capacity would be limited,” Philstocks Financial, Inc. Research Associate Claire T. Alviar said in a separate Viber message.
“This could weigh on their earnings and would adversely affect their recovery,” she added.
All sectoral indices closed the week in the red. Property shed 153.83 points or 4.98% to 2,934.57; holding firms lost 214.53 points or 3.31% to 6,265.28; financials went down by 41.93 points or 2.98% to 1,361.09; industrials shaved off 212.83 points or 2.31% to end at 8,968.38; services declined by 27.88 points or 1.79% to 1,525.23; and mining and oil dropped 66.81 points or 0.67% to 9,776.26.
Value turnover increased to P6.27 billion with 1.81 billion issues traded on Friday, from the P4.82 billion with 925.21 million shares switched hands on Thursday.
Decliners outperformed advancers, 159 versus 47, while 42 names remained unchanged.
Net foreign selling surged to P1.6 billion on Friday from the P465.76 million seen the previous day.
“[The] next support that we are seeing is at the 6,150 level,” Philstocks Financial’s Ms. Alviar said. — Keren Concepcion G. Valmonte
