BY MARICEL E. BURGONIO Senior Reporter and LAILANY P. GOMEZ Reporter

PHilippine stocks fell to a four-month low at the official start of campaigning for the May national elections on Tuesday, with investor sentiment hammered by persistent concern over Europe’s fiscal woes.

At the Philippine Stock Exchange (PSE), the composite index dropped by 1.721 percent, or 48.99 points to 2,797. This was the lowest close since the index fell to 2,784 points in September 28 last year.

The all-shares index likewise shed 1.33 percent, or 24.37 points to 1,799.12 on Tuesday.

Trading volume reached 884,709,103 worth P3.279 billion. Losers outnumbered gainers at 95 to 19.

The mining and oil, as well as industrial sectors suffered the biggest drops, followed by the industrial and financial sectors.

“We’re affected by the sentiment overseas,” Astro del Castillo of First Grade Holdings said.

The Dow Jones Industrial Average on Monday night closed below 10,000 for the first time in three months. Down almost 104 points, the Dow had its 10th triple-digit move in 16 trading days. The US market was wary of the health of the global financial system with the increasing budget deficits of Greece, Portugal and Spain.

“The market is a little jittery on the political environment which is expected to get worst,” Jose Vistan, head researcher at AB Capital Securities, also said.

“There are a lot of negatives like corruption in the election campaign. It doesn’t help our image to foreign investors,” he said.

At the Philippine Dealing System, the peso closed a little stronger at 46.39 against the US dollar Tuesday owing to minor corrections. The local currency ended Monday at 46.59.

It opened Tuesday at 46.70 and traded to a high of 46.75 and a low of 46.37, with trading volume reaching $785.06 million.

“Right now we are dictated by the euro and the US dollar. Risk aversion and volatility will continue to stay until they salvage Spain’s debt woes,” Marcelo Ayes, senior vice president at RCBC, said.

He said the threat of other Asian central banks withdrawing their stimuli are putting pressure on the peso.

Currency traders earlier said the peso is likely to breach the 47-to-a-dollar level within the week as they await news on Europe’s debt woes.