PSEi slumps 2.58% to close at 7,119.04 pts
Share prices on the Philippine bourse tumbled on Wednesday in line with the global market plunge as billionaire populist Donald Trump won the just concluded US presidential election.
The benchmark Philippine Stock Exchange index (PSEi) hit an intraday low of 7,000 points before closing at 7,119.04, losing 2.58 percent or 188.76 points. The broader All Shares index fell 1.88 percent or 81.87 points to 4,282.35.
“Right now, there’s immediate panic. The market will have to consolidate. We need to wait for a few days, but if the index breaks the current support [7,000], the next support will be 6,800,” Summit Securities Inc. President Harry Liu said in a phone interview.
Other financial markets around the world reacted to Trump’s win with a sell-off, sending stocks down across Asia and Europe and billions of dollars wiped off the value of investments. The dollar tumbled against the yen and the euro as Trump defeated market favorite Hillary Clinton in a stunning upset with major implications for the world economy.
Many investors considered Clinton to be a safer bet than Trump, who is seen as a loose cannon with policies many fear could wreck the world’s number-one economy.
Mexicans, fearing Trump’s vow to build a wall to cut America off from its southern neighbor, were dismayed and their peso fell to historic lows.
As Europe awoke to a stark and unwelcome reality, London’s benchmark FTSE 100 index shed 1.87 percent, Frankfurt’s DAX 30 slid 2.9 percent and the Paris CAC 40 index dropped 2.8 percent.
Gold soared more than 5 percent, while fears about the impact on financial markets led Japanese and South Korean authorities to each call crisis talks.
In Manila, “futures also dropped almost 500, so this trend created concern among the investing public,” Summit’s Liu said.
Liu expects the financial markets to enter a consolidation phase, with a negative bias moving forward on concern over the uncertainty that lies ahead.
Forecasts for the PSEi of between 7,600 and 7,800 points at the close of 2016 could still be “possible and probable” because “the drop is not coming from us,” he said.
There is pressure for the market to stage a rally in the medium term, he said, “and the long term is hurting now. But looking at the country’s fundamentals – as can be observed from the PSEi’s bounce from 7,000 to 7,100 during the session – I think we’ll still be able to recover,” he added.
The mining and oil index was the sole gainer among the various sectors, while the rest declined, led by the property index with a 3.47 percent plunge.
Security Bank Corp. was the sole advancer among the actively traded stocks, while the others retreated, including Ayala Land Inc., Metrobank, Universal Robina Corp., Ayala Corp., SM Prime Holdings Inc. and International Container Terminal Services Inc.
Turnover volume totaled 1.97 billion shares, valued at P8.58 billion.
Decliners outnumbered advancers 154 to 43, while 36 issues closed unchanged.