by Jan Michael Carpo, Reporter
Yesterday, the Philippine stock market defied the upward trend in the region by falling further into the red due to significant foreign selling and worries over the health of China’s economy.
At 6,212.39, the benchmark Philippine Stock Exchange (PSE) Composite index closed out with a loss of 77.88 points, or 1.24 per cent. The much larger All Shares Index, meanwhile, also fell by 30.46 points, or 0.90 per cent, to close down at 3,352.95 or 30.46 points lower.
Except for the banking sector, most sectoral indexes were up.
Inside the PSE’s trading floor. (IMAGE CREDIT: www.istock.com)
After breaking through significant support lines last week amid intense foreign selling, the market kept moving downward.
Also, even though other Asian markets were in the green, sentiment in the Philippine market remained negative.
Juan Paolo Colet, managing director of China Bank Capital, stated that this is due to rising US Treasury yields and a disappointing fall in China’s interest rates. “As many investors remain cautious ahead of the US Federal Reserve’s annual policy symposium to be held later this week, the index is nearing the 6,200 support level,” he said in a press statement.
Turnover hit P4.787 billion in total. With 122 issues falling and 60 issues rising, the market breadth was negative. Forty issues, meanwhile, remained constant.
After a recent run of losses, equities rose yesterday throughout Asia, although investor gloom was still there due to worries about the US interest rate outlook and China’s economy.
The possibility that the US Federal Reserve would increase borrowing prices once again before the end of the year to control inflation has caused problems for markets throughout the world this month.
Washington has just released several data points that show the US economy is still strong and the labor market is still tight, even after more than a year of tightening.
Some worry that tightening the screw even more could be lethal.
Jerome Powell, the head of the Federal Reserve, is scheduled to speak this week to a group of central bankers and business executives.
Powell’s speech will be observed by many for any indications of official thinking and future policy.