Stocks plunge as Asean factory activity slows

MANILA, Philippines — The stock market plunged by 113.82 points, or 1.43 percent yesterday, spooked by reports of a slowdown in the country’s manufacturing activity as well as its regional peers.

It was almost another bloodbath across all sectoral indexes if not for the mining and oil index which soared after news that Indonesia would impose a nickel export ban.

The benchmark Philippine Stock Exchange index settled at 7,804.71, while the broader All Shares gauge lost 1.18 percent to end at 4,740.61.

Traders said yesterday’s market slump was due to the slowdown in the Philippines’ manufacturing activity as well as those of its regional peers.

“The slowdown in the Philippines’ and regional peers’ August manufacturing activity sends local stocks lower by 14.97 points to 7,903.56,” Philstocks Financials said in a commentary.

Operating conditions at ASEAN manufacturing firms deteriorated at the fastest pace since November 2015 in August, according to the headline IHS Markit Purchasing Managers’ Index (PMI), with a fall in new business and output weighing on the headline index reading.

In the report, IHS said the headline index fell further below the 50 neutral mark, slipping from 49.5 in July to 48.9 in August and signalling a further deterioration in the health of the ASEAN manufacturing sector, the quickest since late-2015.

“Contributing to the decline was a moderate reduction in new business inflows and a second consecutive downturn in output. The strongest fall in external demand since November 2015 also weighed on overall new orders,” IHS said.