PSEi sinks to 7,800 level on US-China tensions

By Arra B. Francia, Senior Reporter

THE MAIN INDEX plunged to the 7,800 level on Monday, going down with the rest of the region due to escalating trade tensions.

The bellwether Philippine Stock Exchange index (PSEi) plummeted 2.95% or 239.91 points to close at 7,890.02 yesterday, mirroring the bloodbath seen across the region. This marks the PSEi’s lowest finish since May 30, when the index closed at 7,836.55.

The all-shares index likewise fell 2.14% or 105.45 points to 4,821.11.

“Philippine shares wiped out substantial gains from the previous month as President Donald Trump stoked US-China trade fears with the announcement of more tariffs,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.

US President Donald J. Trump last week warned that he would impose a 10% tariff on another $300 billion worth of Chinese imports next month, amid trade negotiations between top US and Chinese officials last week.

Papa Securities Corp. Sales Associate Gabriel Jose F. Perez further attributed the market’s decline to the yuan’s weakness.

“It was a bloodbath for the PSEi as the index dropped 2.95% today amid trade war concerns and the yuan’s depreciation. Weakness was felt across the region as other indices also dropped by around the same magnitude,” Mr. Perez said in a statement on Monday.

With these concerns, Asian indices ended Monday lower. Japan’s Nikkei 225 down by 1.74% or 366.87 points to 20,720.29. The Hang Seng index spiraled down 2.85% or 767.26 points to 26,151.32, while the Shanghai Composite dropped 1.62% or 46.34 points to 2,821.50.

Wall Street indices also finished lower last Friday, with the Dow Jones Industrial Average slipping by 0.37% or 98.41 points to 26,485.01. The S&P 500 index shed 0.73% or 21.51 points to 2,932.05, while the Nasdaq Composite index lost 1.32% or 107.05 points to 8,004.07.

Back home, sectoral indices ended in negative territory, save for mining and oil which climbed 1.16% or 94.31 points to 8,195.78.

The rest went down, led by property which lost 3.46% or 149.63 points to 4,174.37. Industrials shed 2.58% or 294.66 points to 11,117.47; holding firms slumped 2.56% or 202.83 points to 7,698.80; financials tumbled 2.51% or 46.89 points to 1,814.51; while services retreated 1.81% or 29.19 points to 1,583.93.

Some 964.96 million issues valued at P6.37 billion switched hands, higher than Friday’s P5.68-billion turnover.

Decliners were almost triple the advancing stocks, 149 to 55, while 47 names were flat.

Foreign investors were net sellers at P1.19 billion on Monday versus the previous session’s P256.65-million net inflow.

“Issue to watch out for tomorrow would be July’s inflation figure, but also continue to monitor how US markets perform tonight,” Papa Securities’ Mr. Perez said on Monday.