Philip­pine stock woes mount as 2018 losses pass $20-bil­lion mark

Business World - - CORPORATE NEWS -

PHILIP­PINE stocks, al­ready the world’s worst per­form­ers this year, fell to the low­est in al­most a year Tues­day, bring­ing to more than $ 20 bil­lion the loss in mar­ket value for the coun­try’s bench­mark in­dex since the start of 2018.

The Philip­pine Stock Ex­change In­dex dropped as much as 2.3% in Manila trad­ing, on track for its low­est close since May 2017, with five stocks fall­ing for each that gained. The gauge has lost al­most 10% since the end of 2017 as ris­ing in­fla­tion, Asia’s worst per­form­ing cur­rency and a brew­ing US- China trade war have in­creased in­vestor cau­tion to­ward one of the re­gion’s most ex­pen­sive mar­kets.

Pure­gold Price Club, Inc., one of the na­tion’s largest gro­cery store op­er­a­tors, tum­bled more than 11%, its sharpest loss since Au­gust 2015 af­ter 2017 earn­ings missed es­ti­mates and an­a­lysts warned about head­winds. BDO Uni­bank, Inc., the na­tion’s big­gest bank, fell as much as 4%, the big­gest drag on the in­dex.

“We could still see more sell- off as there are con­cerns in the mar­ket that con­sumer spend­ing is get­ting hurt from the weaker peso and higher in­fla­tion,” said Jonathan Rave­las, chief mar­ket strate­gist at BDO Uni­bank. “The op­ti­mism that con­sumer spend­ing will pick up from the tax re­form has been re­placed by ques­tions such as how much earn­ings will be hit by the weaker peso and higher oil prices.”

This year’s slump caught Philip­pine bulls off guard, many of whom en­tered 2018 with a pos­i­tive out­look fol­low­ing the im­ple­men­ta­tion of a tax re­form pro­gram that cut per­sonal in­come taxes while rais­ing levies on other items to fund Pres­i­dent Ro­drigo R. Duterte’s in­fras­truc­ture pro­gram. How­ever, global oil prices have risen 26% in the past year, rais­ing the fuel bill for the crudeim­port­ing coun­try.

Newspapers in English

Newspapers from Philippines

© PressReader. All rights reserved.