Stocks sank the most in two weeks in line with the movement of Asian markets as Italian Prime Minister Matteo Renzi’s resignation sparked worries about political instability in the eurozone and beyond.
The Philippine Stock Exchange index, the 30-company benchmark, fell 110 points, or 1.6 percent, to close at 6,776.41 Monday. The bellwether was also down 2.5 percent since the start of the year.
The broader all-share index tumbled 47 points, or 1.2 percent, to settle at 4,118.65, on a value turnover of P5.3 billion. Losers outnumbered gainers, 124 to 61, while 39 issues were unchanged.
Five of the six major subindices posted losses, with only mining and oil registering gains.
Four of the 20 most active stocks ended in the green, led by property developer Sta. Lucia Inc. which climbed 3.4 percent to P1.23 and conglomerate LT Group Inc. which rose 1.7 percent to P13.16. PLDT Inc. gained 0.8 percent to P1,280, while Cemex Holdings Philippines Inc. went up 0.2 percent to P11.30.
Petron Corp. lost 6.1 percent to P9.50, while conglomerate Ayala Corp. slid 4 percent to P710.
Meanwhile, Asian stocks declined amid concern Italy’s vote against constitutional reform will embolden nationalist movements.
The euro briefly dived to 20-month lows against the dollar on the news, which also sparked demand for the safe-haven yen—a negative for Japanese shares.
Investors largely shrugged off data released Friday that showed the US unemployment rate at a nine-year low in November, virtually guaranteeing a Federal Reserve interest rate hike this month.
Tokyo’s benchmark Nikkei 225 index lost 0.82 percent, or 151.09 points, to end the day at 18,274.99, while the Topix index of all first-section issues was off 0.75 percent, or 11.02 points, at 1,466.96.
The euro slumped to $1.0506 in early deals, its lowest since March 2015, but it later recovered to $1.0556.
And the yen, which is often bought as a safe haven in times of uncertainty, picked up in early deals. The dollar fell to 112.88 yen from 113.51 yen in New York on Friday before bouncing back to 113.52 yen in the afternoon.
Renzi announced his resignation hours after losing a referendum on constitutional reform Sunday.
The defeat and Renzi’s departure threatens to plunge Italy into a new phase of political uncertainty and possible economic turmoil.
Some analysts fear a deeper crisis of investor confidence that could derail a rescue scheme for the country’s most indebted banks, triggering a wider financial crisis across the already struggling eurozone.
“[Renzi’s] defeat in the face of populist moves will spawn concerns over the rest of Europe,” said Yunosuke Ikeda, chief currency strategist at Nomura Securities in Tokyo.
“But given the fact that this had been predicted beforehand, it’s not a surprise in the same way as the Brexit vote or [Donald] Trump’s election victory.
“As Prime Minister Renzi has now resigned, some investors might think all the bad news is out now.” With AFP, Bloomberg