Philippines shuts stock market Covid-19 blamed for first shutdown of equity market in world

Manila/Singapore, March 17: The Philippine Stock Exchange closed indefinitely on Tuesday while currency and bond trading were suspended, the first shutdown of markets worldwide in response to the coronavirus, with authorities citing risks to the safety of traders.

The move comes after some bourses around the world closed trading floors or paused trade after big falls in market value.

It is also open-ended, unlike China’s extension of Lunar New Year holidays in January, which delayed the resumption of trade, or the run of holidays declared in Sri Lanka this week to try and halt the virus, which has closed markets there since Monday.

And while the Philippine shutdown was prompted by health reasons, amid a broad nationwide lockdown, it raises the prospect other exchanges may follow.

“Given the unprecedented speed of the slump in equity prices, it has been suggested that stock exchanges might be closed soon if things don’t turn around,” research house Capital Economics said in a note.

Global markets are in meltdown as the pandemic spreads, with roughly $14 trillion in shareholder value erased and even safe

We have seen it before. I believe we could see it again. Governments do not need or want the added stress and distraction at this time.

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AdMarco research head assets such as gold have been sold to cover losses.

AdMacro research head Patrick Perret-Green had also raised the possibility in a note issued over the weekend, before the Philippines move.

“We have seen it before. I believe we could see it again,” he said. “Governments

do not need or want the added stress and distraction at this time.”

The Philippine Stock Exchange said trade was suspended until further notice “to ensure the safety of employees and traders,” amid a broader national lockdown.

In Malaysia, where a similar lockdown comes into force on March 18, the securities regulator said all capital markets will operate as usual.

Settlement of trades in Sri Lanka is due to be available on March 18, though it is unclear if trade will resume before the nation is set to return from holidays on Friday.