The stock market slumped Friday in anticipation of a rate increase by the US Federal Reserve Board next week, with blue chips leading the retreat.
The Philippine Stock Exchange Index sank 149.18 points, or 2 percent, to 7,146.27 on a value turnover of P8.01 billion. Losers beat gainers, 102 to 72, with 47 issues unchanged.
SM Investments Corp. of retail tycoon Henry Sy Sr. tumbled 9.2 percent to P599, while Emperador Inc., the biggest liquor maker, fell 5.8 percent to P6.35.
Metropolitan Bank & Trust Co., the second-largest lender, dropped 3.7 percent to P77.05, while PLDT Inc., the biggest telecommunications company, lost 2.5 percent to P1,535.
Japanese shares, meanwhile, rallied Friday as the dollar surged against the yen ahead of key US jobs data, while Asian energy firms were mixed following another sharp sell-off in oil.
With the Federal Reserve all but certain to hike US interest rates at a much-anticipated meeting next week, the non-farm payrolls release later in the day will be pored over for clues on bank policymakers’ plans for the rest of the year.
The anticipation sent the dollar bursting past 115 yen on Thursday for the first time since the end of January and it managed to hold on in early Asian business, providing rich picking for Japanese traders buying the country’s exporters.
Tokyo’s Nikkei ended up 1.5 percent, having broken a four-day losing streak on Thursday.
“Now the market appears convinced that the Fed will raise the rate, while investors are expecting encouraging US payroll figures,” Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP. “All in all, Tokyo market sentiment is positive.”
Hong Kong rose 0.2 percent in the afternoon, Sydney added 0.6 percent and Singapore climbed 0.5 percent but Shanghai slipped 0.1 percent.
Seoul put on 0.3 percent as investors were unmoved by news that President Park Geun-Hye’s impeachment had been upheld by a Constitutional Court, making her the country’s first head to be sacked in such a way. The country’s won currency was up slightly.
The dollar also extended gains against the struggling pound, while it managed to temper a rally in the euro which got a shot in the arm after European Central Bank boss Mario Draghi offered an upbeat outlook for the eurozone economy.
The ECB upped its growth and inflation forecasts for this year while Draghi signalled it no longer sees an urgent need to undertake any extra support measures, meaning there would be no increase in euros being pumped into the system.
“Upgraded inflation forecasts and changed language from the ECB are signs the conversation is changing in Europe,” said Greg McKenna, chief market strategist at AxiTrader.
“It was a subtle shift but an important one because even though the ECB president and his governing council keep their guidance… relatively unchanged, their upgraded economic forecasts for the EU show that the worst of the euro crisis looks to be behind the 27-nation bloc.” With AFP