Advertisement

Shares slide on uncertainty over US-China deal

Font Size

PSE BGC bell
BW FILE PHOTO

STOCKS FELL for the sixth consecutive session on Wednesday amid renewed geopolitical woes due to US President Donald J. Trump’s comments on trade talks with China.

The bellwether Philippine Stock Exchange index (PSEi) gave up 1.12% or 85.73 points to close at 7,560.47 yesterday.

The broader all-shares index likewise edged lower by 0.87% or 40.46 points to 4,612.

“Investors are still in risk-off mode particularly foreign funds who have been steadily liquidating since February. To date, net foreign selling has amounted to P47.8 billion for the year, almost reversing the net buy of P55 billion for the entire 2017,” PNB Securities, Inc. President Manuel Antonio G. Lisbona said in a text message.

Net foreign outflows for the day reached P649.85 million, higher than the previous session’s P628.52 million. This is the sixth day of net selling for the market.

“On the whole, foreign investors seem to be cashing in and adopting a risk-averse stance amid renewed concerns on trade between the US and China,” Mr. Lisbona said.

Mr. Trump said the US government did not arrive at a deal with China for its trade dispute, despite top US officials saying earlier they have agreed on a framework and have put the trade war on hold.

Wall Street also ended in the red following these developments. The Dow Jones Industrial Average plunged 0.72% or 178.88 points to 24,834.41. The S&P 500 index went down 0.31% or 8.57 points to 2,724.44, while the Nasdaq Composite index dipped 0.21% or 15.58 points to 7,378.46.

Most Southeast Asian stock markets likewise fell sharply on Wednesday as Mr. Trump tempered optimism over trade talks between Washington and Beijing, with Malaysia extending losses amid uncertainty over the size of debt its previous government had left behind.

Broader Asian stocks outside Japan were down 0.40% after Mr. Trump said he was not pleased with recent US-China trade talks, renewing uncertainty.

China Bank Securities Corp. Research Director Garie G. Ouano, meanwhile, attributed the PSEi’s decline to technicalities.

“Probably due to technical factors since there were no major market-moving developments today and the index has so far formed a trading range around 7800-7500,” Mr. Ouano said.

All sectoral indices closed in negative territory, led by holding firms with a 1.75% drop or 132.17 points to 7,381.05. Financials shed 1.52% or 28.65 points to 1,851.86, while services slipped 0.59% or 9.10 points to 1,514.29. Industrials went down 0.38% or 41.96 points to 10,905.02; mining and oil lost 0.28% or 28.27 points to 9,958.01; while property declined 0.07% or 3 points to 3,801.78.

A total of 1.86 billion issues switched hands resulting in a turnover of P5.88 billion, up from Tuesday’s P4.78 billion.

Decliners outpaced advancers, 116 to 66, while 55 issues remained unchanged. — Arra B. Francia with Reuters