Stocks drop on lockdown fears as cases climb

PHILIPPINE shares slipped on Wednesday on fears of a tighter lockdown as coronavirus disease 2019 (COVID-19) infections rise anew and due to the spread of the Delta variant.

The Philippine Stock Exchange index (PSEi) declined by 49.55 points or 0.76% to close at 6,473.03 on Wednesday, while the all shares index shed 29.66 points or 0.73% to 4,010.09.

“Market [is] pricing in Delta variant spread and stricter lockdown worries but the fact that big losses in early morning trade tempered on close showed bargain hunting at work,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message.

“In addition, IMF’s (International Monetary Fund) lower GDP (gross domestic product) growth forecast for the ASEAN-5 and the Oxford Economics’ expectation that the Philippines would suffer the worst economic scarring in the Asia-Pacific, weighed on the sentiment,” Philstocks Financial, Inc. Research Associate Claire T. Alviar said in a separate Viber message.

“Many traders were also on the sidelines, waiting for the next quarantine measures,” she said.

“It is mainly the lack of demand for shares that is keeping prices depressed,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail.

“Although we are not seeing a spike in cases just yet, these fears may persist for months as the disease has proven to be very unpredictable. The only upside is the pace of vaccination,” Mr. Mangun added.

COVID-19 infections rose by 7,186 to bring active cases to 56,477 on Tuesday, based on data from the Department of Health. This was the highest daily tally in over a month or since June 13 when daily cases increased by 7,302.

There were 119 Delta variant cases in the Philippines as of Sunday.

The OCTA Research Group said hospitals in Metro Manila may be filled by the middle of next month if the country records a surge in Delta infections and called for an “early circuit-breaker” through targeted lockdowns.

All sectoral indices posted losses on Wednesday. Financials lost 18.10 points or 1.28% to 1,391.27; industrials went down by 105.80 points or 1.15% to 9,031.92; mining and oil shaved off 94.38 points or 0.97% to 9,591.71; property declined by 23.35 points or 0.75% to 3,074.79; holding firms decreased by 30.27 points or 0.46% to finish at 6,473.06; and services inched down by 4.48 points or 0.28% to 1,552.47.

Value turnover increased to P4.49 billion with 1.08 billion shares switching hands on Wednesday from the P4.30. billion with 1.17 billion issues traded the previous day.

Decliners outnumbered advancers, 144 versus 44, while 37 names remained unchanged.

Net foreign selling ballooned to P772.37 million on Wednesday from the P329.92 million logged in net outflows on Tuesday.

“We expected the PSEi’s pullback although it managed to stay above the 6,450 support, which it may maintain until the end of the week,” AAA Southeast Equities’ Mr. Mangun said. — Keren Concepcion G. Valmonte

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>