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Business

Philippine shares swam in red as recession concerns dominate global equities

Ramon Royandoyan - Philstar.com
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In this May 10, 2022 photo, the external display of the Philippine Stock Exchange building in Taguig City shows PSEi's closing a day after the presidential elections.
PSE / Released

MANILA, Philippines — Bloodshed ensued within the local bourse on Tuesday as local shares veered closer to a bear market as global equities were rocked by recession fears. 

The Philippine Stock Exchange index traded in negative territory for most of the day. Local shares shed 3.83% to 6,020.07 by the time trading closed, falling below the 6,000-level at one point. The broader All-Shares index closed 3.2% down, with all the sub-indices awash in red. 

Luis Limlingan, head of sales at local brokerage Regina Capital, noted the US Federal Reserve’s actions last week sent the local bourse on edge. 

“The market selloff resumed with local shares following the equity sell-off stateside on the back of an aggressive Federal Reserve and surging interest rates, which in turn have roiled currency markets. The Federal Reserve’s aggressive hiking campaign, coupled with the U.K.’s tax cuts announced last week has caused the USD to surge, pushing to PHP to the 59.00 territory,” he said in a Viber message.

As it is, analysts worldwide fear that the global economy will enter into a recession in the coming months following the Fed’s aggressive tightening. The impact has been much pronounced in the local unit, as the peso kept sinking to new lows last week. 

The PSEi’s finish on Tuesday brings it closer and closer to a bear market, which happens when stocks fall 20% or below from recent highs. The local bourse hit its highest back in February, at 7,552, which Hernan Segovia, trader at Summit Securities, explained was still not at 20% territory.

“Index closed today below the bear line territory at 6,041 but tomorrow is another day,” he said. 

Regional equities were a mixed bag, however. Tokyo, Shanghai, Sydney, Seoul, Taipei and Mumbai all rose but red was flashing up on screens in Hong Kong, Singapore, Wellington, Bangkok, and Jakarta.

Foreign investors sold P11.45 billion more shares than they bought in the stock market. A total of million 2.19 billion stocks, valued at P20.9 billion, switched hands on Tuesday. — with AFP

ASIAN STOCK MARKETS

PHILIPPINE STOCK EXCHANGE

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