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Friday, April 19, 2024

Stock index falls below 6,000 amid sell-off

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Stocks fell Friday in line with a global sell-off fueled by recession fears as central banks ramp up interest rates to fight inflation.

The PSE index, the 30-company benchmark of the Philippine Stock Exchange, dropped 72 points, or 1.2 percent, to close at 5,983.56 as four of the six subsectors ended in the red.

The broader all-share index also went down by 28 points, or 0.9 percent, to settle at 3,195.04 on a value turnover of P4.5 billion. Losers outnumbered gainers, 105 to 67, while 48 issues were unchanged.

Two of the 10 most active stocks ended in the green. Ayala Corp. rose 1.5 percent to P659.00, while Ayala Land Inc. gained 1 percent to P25.95. Globe Telecom Inc., however, tumbled 6 percent to P2,330.00.

Most Asian markets also traded lower. Hong Kong’s Hang Seng Index slipped 0.42 percent, or 69.10 points, to 16,211.12.
The Shanghai Composite Index edged up 0.13 percent, or 3.88 points, to 3,038.93, while the Shenzhen Composite Index on China’s second exchange eased 0.24 percent, or 4.74 points, to 1,966.93.

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Tokyo shares fell, extending losses after falls on Wall Street as US Treasury yields rose, reflecting fresh rate hike worries.

The benchmark Nikkei 225 index slipped 0.43 percent, or 116.38 points, to end at 26,890.58, while the broader Topix index fell 0.71 percent, or 13.43 points, to 1,881.98.

The overall mood of global investors has soured as US yields head higher and the Federal Reserve continues its aggressive rate-hike campaign to fight inflation.

The Fed’s “strategic bias is for more rate hikes now and fewer later when fighting inflation and will continue to bite so long as inflation remains sticky”, said Stephen Innes of SPI Asset Management.

“Risky asset uncertainty will loom large next week” as more major US firms release earnings, he added.

The market is also awaiting the delayed release of Chinese GDP data after pessimistic predictions from analysts, Innes said.

The figures may become available after the Communist Party Congress comes to an end this weekend.

“I do not think anyone is optimistic either,” Innes added, pointing to Friday’s falling stocks.

The US rate hikes have caused the yen to slide to its lowest level against the dollar in over three decades, while the Bank of Japan sticks to its longstanding monetary easing policies.

The greenback rose to 150.40 yen in Tokyo against the 150.19 yen seen in New York on Thursday.

Japanese Finance Minister Shunichi Suzuki has remained tight-lipped about whether, or when, the government could again intervene in the market to artificially prop up the yen.

Shortly before the opening bell on Friday, the Japanese government said prices increased 3.0 percent in September from a year ago—in line with market expectations but still the highest level since 2014.

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