Stocks drop on continued volatility
MANILA, Philippines — Share prices remained in the red yesterday as inflation remains a concern, with investors taking a wait-and-see stance on the economic plans of the next administration.
The benchmark Philippine Stock Exchange index (PSEi) fell 85.07 points (1.27 percent) to 6,635.86 while most sectoral indexes dropped except for services (up 0.48 percent) and mining and oil (up 2.63 percent) following strong first quarter earnings of stocks under this sector.
The broader All Shares index slipped 0.74 percent to 3,557.97.
“Investors traded cautiously while waiting for clues on the incoming administration’s economic policies, primarily those pertaining to a sustainable economic recovery, inflation, labor market loopholes, and the country’s fiscal position,” said Japhet Tantiangco of Philstocks Financial.
He said trading weakened with a net value turnover at P6.14 billion, below the preceding day’s P8.76 billion. Foreigners were net sellers with net outflows amounting to P441.63 million.
“Volatility is expected to persist, as investors await direction on the economic policy of the incoming administration under Ferdinand Marcos Jr.,” AB Capital Securities said in a commentary.
Around Asia, stocks were mixed, with Chinese benchmarks pressing higher after a rally in technology companies helped reverse most of an early slide on Wall Street.
Surging inflation is prompting central banks and governments in many countries to rein in support provided to markets and businesses during the height of the pandemic.
The moderation of price increases in China raised expectations authorities will opt for more stimulus spending to counter the impact of shutdowns in many major cities to fight coronavirus outbreaks.
“In the context of the inflation landscape elsewhere in the world, China is in a very sweet spot at the moment, markets today are pricing that it gives China’s government room to unleash some juicy stimulus,” Jeffrey Halley of Oanda said in a commentary.
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