The local stock market’s mining and oil sub-index slumped further on Wednesday, after Regina Paz Lopez of ABS-CBN Foundation Inc., who described herself late Monday as “absolutely anti-mining,” accepted the offer of President-elect Rodrigo Duterte to head the Department of Environment and Natural Resources (DENR).
The mining and oil board at the Philippine Stock Exchange plunged 7.31 percent or 837.14 points to close at 10,614.70.
“The reason why the mining sector has again dropped substantially today [Wednesday] was that Gina Lopez accepted the position being offered to her. She is known to be an anti-mining advocate,” Victor Benavidez, general manager of Alakor Securities Corp. said in a phone interview.
As posted on Twitter by ANC’s nightly business program late night Monday, Lopez was quoted as saying, “I am absolutely anti-mining as it causes suffering for the poor.”
“This is the immediate reaction of the market. Thus, the mining sector was battered,” Benavidez added.
He explained that by appointing Gina Lopez, the incoming Duterte administration has created confusion among mining investors and stakeholders.
“In his recent pronouncements, President-elect Duterte said he would allow the mining
industry to flourish provided it conforms with the Australian standard. But here you are, appointing a person who is well known as an anti-mining advocate. So as of now, the position of the government [on mining]is quite conflicting,” he noted.
Therefore, the new administration should come up with it a “clear-cut” policy that would govern the country’s mining sector, he said.
Eight of the 10 biggest losers of the day were mining index issues, including Philex Mining Corp. (PX), losing 10.86 percent and dropping from P8.01 to P7.14 per share, and Semirara Mining and Power Corp. (SCC), which tumbled from P129.80 to P119.50 per share, a slide of 7.94 percent.
On the other hand, the benchmark Philippine Stock Exchange Index (PSEi) was not seriously affected overall by the rout of the mining sector, slightly dipping 0.14 percent or 10.86 points to end at 7,756.37, while the wider All Shares likewise moved sideways 0.05 percent or 2.31 points to close at 4,603.14.
“The PSEi slightly dropped as investors stayed cautious ahead of the Brexit referendum. At the same time, the mining sector led the losses after the appointment of Gina Lopez, a staunch anti-mining advocate, as head of the DENR,” Jonathan Latuja, equity research analyst at Unicapital Securities Inc., said.
Total value turnover was low at P7.6 billion, with losers edging out winners, 108 to 86, while 44 issues remained unchanged.
All other sub-indices ended in negative territory, except for the industrial firms, which managed to gain 0.94 percent.