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THE peso and the local bourse joined financial
markets across Asia that weakened as the US financial crisis claims
more casualties in Europe.
At the Philippine Dealing System,
the local currency closed at 47.430 to the dollar on Monday, weaker
than Friday’s 47.040 finish.
“The peso movement is on
account of risk aversion. The financial market turmoil is taking its
toll in terms of lower capital flows to many emerging markets
including the Philippines,” Diwa Guinigundo, Bangko Sentral ng
Pilipinas (BSP) deputy governor, said.
He said the peso, however, would
strengthen in the latter part of October, driven mainly by high
remittances from overseas Filipinos.
“We expect by the last quarter
of 2008, we should see more inflows coming from remittances,
receipts from services and tourism,” he said. Also helping prop up
the peso are foreign currency receipts from business process
outsourcing companies.
At the Philippine Stock Exchange,
share prices closed 2.6 percent lower Monday over worries of a
global economic slowdown, dealers said.
The composite index lost 66.68
points to 2,499.53, while the all shares index shed 2.6 percent to
1,574.03 points.
Decliners led advancers 87 to
eight with 29 unchanged.
Turnover reached 652.6 million
shares worth P2.126 billion.
“There’s a general lack of
interest to invest. Investors are bearish at the moment,” Nisha
Alicer of DA Market Securities told Dow Jones Newswires.
“The focus of the world lately
has been the European market, and news from that continent is adding
to the prevailing pessimism,” Alicer added.
Even with the passage of the
$700-billion US financial sector bailout last week, investors
realize it “will be a long road to economic recovery and that
there are a lot of hurdles along the way,” said Ron Rodrigo of DBP-Daiwa
Securities.
Other Asian stock markets
suffered a fresh mauling Monday with Tokyo plunging to a four-year
low on growing doubts about whether a Wall Street bailout package
can stem the global financial crisis.
Investors were spooked by signs
of escalating problems in Europe after Germany’s fourth- biggest
bank had to be rescued over the weekend. The yen soared as investors
unwound risky bets.
Tokyo’s Nikkei-225 index ended
down 4.25 percent as Sydney lost 3.3 percent and Seoul tumbled 4.3
percent. Hong Kong was 3.4 percent lower by midday while Shanghai
dropped 3.8 percent.
“The market is not convinced
that the US bailout package can protect the economy from the
financial crisis,” said Toyo Securities strategist Ryuta Otsuka.
In an effort to keep credit
flowing, Japan’s central bank pumped emergency funds into the
short-term money market for a 14th-straight business day, pouring in
1 trillion yen ($9.5 billion) in the morning.
Investors dumped shares after US
stock markets fell sharply Friday, despite US congressional approval
of a $700-billion bank bailout.
Dealers said the declines
reflected worries that the plan would not be a panacea for the broad
economic and banking woes in the United States.
Underscoring the worsening
conditions in the world’s largest economy, 159,000 US jobs were
lost in September, according to government figures.
--Maricel E. Burgonio and AFP
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