Local stocks sink as new virus cases climb

 Local stocks sink as new virus cases climb
Philippine Stock Exchange index

A surge in new cases of coronavirus disease 2019 (COVID-19) sent Philippines shares tumbling on the last trading day of the year, analysts said on Friday when the market also took in news that existing mobility restrictions will be 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 shares index fell by 65.26 points or 1.68% to 3,818.12.

“The local bourse declined on the last trading day of the year due to the surge in COVID-19 daily cases with a positivity rate of 6.6%, higher than the World Health Organization’s benchmark of below 5%,” Philstocks Financial, Inc. Senior Research and Engagement Officer Claire T. Alviar said in a Viber message.

On Thursday, the Philippines recorded 1,623 new COVID-19 cases, the highest since Nov. 21. On the same day, the government announced that the whole country will remain in Alert Level 2 or the second most relaxed quarantine category.

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

Ms. Alviar also noted that the net market value turnover was lower than the year-to-date average of P7.4 billion.

Value turnover inched up P5.38 billion with 623.43 million issues traded, from the P5.23 billion recorded on Wednesday with 1.75 billion shares switching hands.

“The PSEi also lowered as the country’s Alert Level 2 [is] maintained until mid-January 2022 as a matter of prudence to better deal with the threat of the Omicron variant, thereby making Alert Level 1 not possible for now,” Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael. L. Ricafort said in a Viber message.

Mr. Ricafort said that had it not been for the Omicron variant, the alert level would have been eased.

Meanwhile, all sectoral indices declined on the last trading day of the year led by holding firms, which dove down 250.08 points or 3.54% to 6,807.27.

Financials declined by 54.74 points or 3.29% to 1,606.17; services retreated 47.14 points or 2.31% to 1,986.37; industrial lost 158.82 points or 1.50% to 10,404.09; property decreased 39.83 points or 1.22% to 3,219.68; and mining and oil dropped 31.61 points or 0.32% to 9,601.70.

Foreigners turned sellers with P413.64 million in net outflows, a reversal of the P568.3 million logged in net purchases on Wednesday. Trading was closed on Thursday in observance of Rizal Day, a national holiday.

The market closed earlier on Friday as Filipinos prepare for New Year’s Eve celebrations.

Decliners outnumbered advancers, 111 against 73, while 49 names were unchanged.

Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said that with the anticipated surge in COVID-19 cases in the country, negative sentiment will prevail in the market and may break the 7,000 level. — Marielle C. Lucenio