Local stocks collapse as new virus cases soar

Philippine Stock Exchange Index

An increase in the number of new cases of coronavirus disease 2019 (COVID-19) caused Philippine stocks to fall on the last trading day of the year, analysts said on Friday when the market also learned that existing mobility restrictions would remain unchanged until mid-January.

The Philippine Stock Exchange index (PSEi) plunged 211.93 points or 2.88% to close the week at 7,122.63, while the broader all-stock index fell 65.26 points or 1.68% at 3,818.12.

The local stock market fell on the last trading day of the year due to the increase in daily COVID-19 cases with a positivity rate of 6.6%, above the Organization’s benchmark global health below 5%, “Philstocks Financial, Inc. Senior Head of Research and Engagement, Claire T. Alviar, said in a Viber message.

The Philippines recorded 1,623 new cases of COVID-19 on Thursday, the highest since November 21. On the same day, the government announced that the entire country would remain on Alert Level 2 or the second most relaxed category of quarantine.

The Department of Health has so far announced four patients confirmed positive for Omicron, the latest variant of the coronavirus.

Ms. Alviar also noted that the net market value turnover was lower than the annual average of 7.4 billion pesos.

Turnover in value increased by 5.38 billion pesos with 623.43 million issues traded, compared to 5.23 billion pesos recorded on Wednesday with 1.75 billion shares having changed hands.

“The PSEi also dropped as the country’s alert level 2 [is] maintained until mid-January 2022 as a precautionary measure to better cope with the threat of the Omicron variant, thus making Alert Level 1 impossible at this time, ”said Michael, Chief Economist of Rizal Commercial Banking Corp. (RCBC). L. Ricafort said in a Viber message.

Mr Ricafort said that without the Omicron variant, the alert level would have been relaxed.

Meanwhile, all sector indices fell on the last trading day of the year, led by holding companies, which plunged 250.08 points or 3.54% to 6,807.27.

Financials fell 54.74 points or 3.29% to 1,606.17; services fell 47.14 points or 2.31% to 1,986.37; industry lost 158.82 points or 1.50% to 10,404.09; real estate fell by 39.83 points or 1.22% to 3,219.68; and mining and petroleum lost 31.61 points or 0.32% to 9,601.70.

Foreigners have become sellers with 413.64 million pesos in net outflows, a reversal of 568.3 million pesos in net purchases recorded on Wednesday. The business was closed Thursday on the occasion of Rizal Day, a national holiday.

The market closed earlier on Friday as Filipinos prepare for New Years celebrations.

Drops outnumbered advances, 111 to 73, while 49 names were unchanged.

Diversified Securities, Inc. stock trader Aniceto K. Pangan said that with the expected surge in COVID-19 cases in the country, negative sentiment will prevail in the market and may exceed the 7,000 level. – Marielle C. Lucenio

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