Advertisement

Stocks fall further; DMCI tumbles

The stock market extended its slump Tuesday on fears the Bangko Sentral ng Pilipinas will further tighten its monetary policy to rein in inflation and its second-round effects.

The Philippine Stock Exchange Index tumbled 107.49 points, or 1.4 percent, to 7,527.78 on a value turnover of P5.3 billion. Losers overwhelmed gainers, 141 to 60, with 41 issues unchanged.

Faster inflation compelled the Bangko Sentral to raise the policy interest rate by 50 basis points to 4 percent on Aug. 9.

Bangko Sentral ng Pilipinas Gov. Nestor Espenilla Jr. last week said: “favorable conditions arising from sustained domestic growth also suggest that the economy can accommodate a further tightening of monetary policy settings.”

“We believe that this is not the end of BSP’s tightening as the immediate objective to anchor inflation expectations would need further action since inflation is yet to peak and would remain elevated for the rest of the year and early 2019,” ING Bank Manila senior economist Joey Cuyegkeng added.

Bank of the Philippine Islands, the third-biggest lender in terms of assets, lost 3.2 percent to P92.40, while sister unit Globe Telecom Inc., the second-largest telecommunications firm, fell 3.1 percent to P1,860.

Casino operator Bloomberry Resorts Corp. declined 4 percent to P10.04, while DMCI Holdings Inc., which is into coal mining, power generation, property, construction and water distribution lost 3.5 percent to P11.50.

Turkey’s lira, meanwhile edged up with other emerging market currencies in Asian trade Tuesday while equities also enjoyed a bounce after the previous day’s turmoil.

Investors slowly edged back into buying mode but they are keeping a nervous eye on developments in Ankara after Monday’s bloodletting that saw the lira hit record lows against the dollar and euro, and equity markets go into free-fall on concerns Turkey’s financial crisis could spread globally.

On equity markets, Tokyo ended 2.3 percent higher as the safe-haven yen eased against the dollar, providing some support to exporters.

Sydney added 0.8 percent and Seoul was 0.5 percent higher, with Wellington, Mumbai, and Taipei also posting healthy gains. Singapore was flat.

But Shanghai ended 0.2 percent lower and Hong Kong slipped 0.8 percent in the afternoon.

In Asia, the Turkish unit was at 6.60 to the dollar and 7.49 to the euro, well off the 7.24 to the dollar and 8.12 to the euro seen Monday but still uncomfortably high. The unit is down about a fifth against the greenback since Friday.

Fears about contagion in other economies, particularly emerging markets, sparked a sell-off across the board Monday but there were healthy recoveries in Asian business.

The Russian ruble, which lost two percent Monday, jumped 1.7 percent, while the South African rand was 2.2 percent higher, having lost seven percent a day earlier. The Mexican peso was up 1.8 percent. With AFP

Topics: stock market , Bangko Sentral ng Pilipinas , Philippine Stock Exchange Index , Gov. Nestor Espenilla Jr. , Bank of the Philippine Islands
COMMENT DISCLAIMER: Reader comments posted on this Web site are not in any way endorsed by Manila Standard. Comments are views by manilastandard.net readers who exercise their right to free expression and they do not necessarily represent or reflect the position or viewpoint of manilastandard.net. While reserving this publication’s right to delete comments that are deemed offensive, indecent or inconsistent with Manila Standard editorial standards, Manila Standard may not be held liable for any false information posted by readers in this comments section.
AdvertisementKPPI
Advertisement