Share prices ended lower Thursday as risk-aversion continues to haunt the market.
The peso, however, edged up.
The Philippine Stock Exchange index (PSEi) was down 183.23 points to 6,926.03, a 2.58 percent drop.
The broader all shares index was down 79.26 points to 3,701.23, a 2.1 percent drop.
Losers edged gainers 139 to 33 with 52 stocks unchanged. Trading turnover reached P6.41 billion.
The peso closed at 51.42 to the dollar, up from 51.43 on Wednesday.
The currency opened at 51.37 and hit a high of 51.33 and a low of 51.43. Trading turnover reached $885.5 million.
Currencies fell on Thursday as hawkish comments from the US Federal Reserve sparked a selloff in the region, while the COVID-19 lockdowns in China also weighed on sentiment, Reuters reported.
“The Fed’s tightening and the balance sheet reductions are likely to be headwinds for Asian equities this year but we are looking out for the upcoming earnings season in the US to see if there are any signs of weakness,” said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.
Investors were also concerned about the situation in China, which is struggling to quell a rise in COVID-19 infections.
“Besides oil and Fed’s meeting, regional markets are also looking out for some policy support from China amid a rise in infections and the dismal services data from the day before,” Tan said.
Inflationary pressures due to global supply snags, made worse by the Ukraine crisis, have compelled some Asian central banks to shake off their long-held reluctance to follow their global peers to hike interest rates.
The Philippines central bank said it would more closely watch inflation expectations, a change of stance compared to its previous more passive approach.
Luis Limlingan, managing director at Regina Capital and Development Corp., said the same issue on the monetary policy stance of the US Fed dragged market sentiments down.
“Philippine shares fell with investors continuing to digest the Federal Reserve’s plans to tighten monetary policy. The March FOMC (Federal Open Market Committee) minutes revealed some of the key parameters of the balance sheet reduction process, including that the monthly cap would likely be set at $95 billion–split $60 billion and $35 billion between Treasury and mortgage-backed securities–and that the caps would be phased in ‘over a period of three months or modestly longer’,” he said.
“On top of this, the minutes indicated that participants judged it appropriate to move towards a neutral policy position ‘expeditiously’,” he added.
Most actively traded BDO Unibank Inc. was down P3.40 to P130. SM Investments Corp. was down P12 to P870. Converge ICT Solutions Inc. was down P1.15 to P27.85. Ayala Land Inc. was down P0.60 to P34.20. International Container Terminal Services Inc. was down P4 to P218. SM Prime Holdings Inc. was down P1.55 to P36.30. PLDT Inc. was down P45 to P1,795. Universal Robina Corp. was down P5.90 to P117. Bank of the Philippines was down P1.60 to P96.50. Ayala Corp. was down P30 to P770.
