PH, global stock markets plummet

The stock market slumped Thursday after a meltdown in New York and Europe sparked by France reimposing a nationwide coronavirus lockdown, with fears other major economies could follow suit.

The Philippine Stock Exchange Index plunged 128.40 points, or 2 percent, to 6,249.39 on a value turnover of P6.6 billion. Losers overwhelmed gainers, 147 to 58, with 52 issues unchanged.

Major property developer Ayala Land Inc. fell 4.9 percent to P32.20, while Bloomberry Resorts Corp. of port tycoon Enrique Razon Jr. dropped 4.3 percent to P7.06.

Robinsons Land Corp., the property unit of the Gokongwei Group, declined 4 percent to P15.36, but Converge Information and Communications Technology rose 8.9 percent to P15.16 after slumping for three straight days.

The rest of Asian markets mostly fell Thursday. With sentiment already dampened by US lawmakers’ failure to pass a new stimulus and election uncertainty, the news out of Paris was the last thing investors wanted to hear as the recovery from this year’s global financial rout was already stuttering.

France’s President Emmanuel Macron’s decision to shut down the country for a month came as Germany said it would impose drastic new curbs as experts warned hospitals would soon be overwhelmed.

The moves followed weeks of exponentially rising new infections across Europe that have forced governments across the continent to put containment measures in place, with warnings that Britain could be next.

The announcements pummeled European markets on Wednesday with Frankfurt diving more than four percent and Paris more than three percent. All three major indexes on Wall Street fell more than three percent as equities suffered one of their worst sessions since the dark days of February-March.

Tokyo, Hong Kong, Seoul, Singapore, Bangkok and Wellington all fell, with Sydney and Taipei losing more than one percent each. Mumbai edged up.

“Market sentiment is turning, with investors buffeted by US election uncertainty and now economic worries from rising Covid-19 cases across Europe, sparking concerns that measures to control the virus will hamper economic activity,” said Kerry Craig at JP Morgan Asset Management.

Shanghai edged up following reports Joe Biden, who is well ahead of Donald Trump in national and battleground polls, will reconsider the president’s tariffs on Chinese imports.

“The price action in Shanghai suggests that all of Biden’s allies will tell him to get rid of Chinese tariffs,” said OANDA’s Jeffrey Halley.

Lori Heinel, of State Street Global Advisors, added: “And then you’ve got the lack of stimulus, which in our estimation is still necessary to get us through this period until we get an ultimate medical solution.”

However, while the mood on trading floors was downbeat, analysts said markets were unlikely to return to their March lows, buoyed by vast sums in central bank support and expectations that a US stimulus will eventually get passed. With AFP