Stocks decline further on geopolitical concerns

LOCAL STOCKS declined on Thursday as negative sentiment reigned in regional markets amid the United States’ (US) heightening political tensions with North Korea.

The bellwether Philippine Stock Exchange index dropped 0.24% or 19.58 points to 7,966.25.

The broader all-shares index declined 0.3% or 14.57 points to 4,708.56 points.

“Right now the market is viewing it as a lot of saber-rattling and a lot of smoke, but not much fire,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message on Thursday, referring to the political tension between US and North Korea.

Southeast Asian stock markets, except Singapore and Vietnam, edged lower on Thursday as lingering tensions between the US and North Korea dampened risk appetite in the region, which is geographically close to the epicenter of this crisis.

Asian shares snapped a brief foray into positive territory earlier in the day to drop 0.9%, extending losses from Wednesday when strong rhetoric drove investors out of stocks and into textbook safe havens like gold and Treasuries.

Pyongyang’s state-run KCNA news agency said it was considering plans to fire four intermediate-range missiles to land 30-40 kilometers from Guam, a US Pacific territory home to a military base that includes a submarine squadron and an air base.

This comes after US President Donald J. Trump said on Tuesday North Korea “will be met with fire and fury like the world has never seen” if it threatened the United States again.

Summit Securities, Inc. President Harry G. Liu said investors are likewise still digesting corporate earnings results for the first half.

“Overall, it’s still within the resistance and support level consolidating in the medium term... We need better news to push it to the 8,100 [ level],” Mr. Liu said in a phone interview yesterday.

Regina Capital’s Mr. Limlingan also noted that investors were waiting for the result of the Bangko Sentral ng Pilipinas’ (BSP) policy meeting.

After markets closed yesterday, the BSP announced it kept interest rates steady, noting the inflation environment “remains manageable.”

Sectoral counters ended mixed on Thursday. Industrials slumped 1.61% or 176.19 points to 10,749.66; holding firms went down 1.12% or 89.35 points to 7,859.37; and mining and oil dropped 0.8% or 102.34 points to 12,608.72.

Meanwhile, services surged by 1.73% or 28.64 points to 1,684.46; financials climbed 0.42% or 8.45 points to 1,994.42; and property inched up 0.23% or 8.93 points to 3,786.66.

Decliners trumped advancers, 111 to 84, while 52 issues closed unchanged.

Value turnover stood at P5.17 billion on Thursday, lower than Wednesday’s P6.93 billion, as 1.17 billion issues changed hands.

Net foreign buying continued and was logged at P168.94 million yesterday, down from the P342.71 million seen the previous trading day. —