Covid-19 fears push stocks lower anew

LOCAL shares finished lower on Monday as worries over the rising number of coronavirus disease 2019 (Covid-19) cases here and overseas continue to dampen sentiment.

The benchmark Philippine Stock Exchange index (PSEi) shed 1.4 percent or 86.66 points to finish at 6,105.18, while the wider All Shares lost 0.94 percent or 34.29 points to close at 3,596.86.

Philstocks Financial Inc. research associate Japhet Tantiangco attributed the main index’s decline to the health crisis and its economic impact, as well as to the Bangko Sentral ng Pilipinas’ projection that the local economy would contract by 5.7 percent to 6.7 percent in the second quarter.

“Overall economic outlook is still weighed by the pandemic as cases continue to rise both onshore and offshore,” Tantiangco explained.

As of Monday, the number of confirmed Covid-19 cases in the country increased by 985 to 36,438. Of this number, 9,956 have recovered and 1,255 died.

Worldwide, the number of confirmed cases rose to more than 10.15 million. Of this number, more than 5 million have recovered and over 502,000 succumbed to the disease, according to the latest data from Johns

Hopkins University.

Tantiangco also said trading had been “weakening” lately.

Total volume turnover hit 1.01 billion shares, valued at P5.55 billion, on Monday, which Tantiangco said was below the yearto-date average of P5.97 billion.

“This implies that some investors are starting to stay on the sidelines amid the uncertainties,” he explained.

Net foreign selling, meanwhile, was at P907.99 million.

“Our silver lining for the day is that the PSEi managed to close above 6,100, implying that this level is still respected as a support. Moving forward, however, with the local market’s downward bias, we may see this support retested,” Tantiangco said.

AAA Equities Research Head Christopher Mangun blamed the market drop on the central bank’s revised gross domestic product estimate for April to June.

He said Asian markets “started the week with losses as investors decide to be more cautious [ and] surging coronavirus cases continue to weigh heavily on the sentiment.”

Tokyo was down by 2.3 percent, Shanghai shed 0.61 percent, Hong Kong fell by 1.01 percent, Seoul declined by 1.93 percent, Jakarta slipped by 0.05 percent, Singapore lost 1.14 percent, Bangkok decreased by 0.72 percent and Ho Chi Minh slumped by 2.65 percent.

In Manila, all sectors fell, with financials losing most at 2.76 percent.

Losers outpaced winners, 142 to 63, while 44 securities were unchanged.