European banking woes drag down PSEi

MANILA, Philippines - The stock market’s recovery was short-lived, closing in negative territory again yesterday as it tracked regional bourses which reflected investor concerns on European banking woes.

The benchmark Philippine Stock Exchange index (PSEi) plunged 85.13 points, or 1.10 percent, to settle at 7,629.73.

Similarly, the broader All Shares index finished at 4,533.24, down 40.15 points or 0.87 percent.

Most of the counters likewise ended in the red, with the services and property sectors, closing in negative territory.

Total value turnover reached P13.58 billion. Decliners beat advancing stocks, 119 to 65 while 45 stocks did not move.

The market tracked regional marts yesterday which extended their losses on worries about the health of the Deutsche Bank.

Shares of the German lender slumped to a record low following reports that its trading clients had withdrawn excess cash.

Clients reacted to the bank’s $14 billion fine slapped but the US Department of Justice over its sale of mortgage-backed securities.

Deutsche Bank is Germany’s biggest bank which has been struggling for years, highlighting the need to push through with much needed financial sector reforms.

To allay fears of investors, the bank said it had entered into a deal to sell its subsidiary and that it was not seeking support from the government.

Investors, however, fear that the impact of the bank’s fine would spill over to other big banks.