Stocks fell for a fifth day, as caution dominated the market amid uncertainties surrounding the so-called ‘hard Brexit’ and Donald Trump’s policies.
The Philippine Stock Exchange Index sank 115 points, or 1.6 percent, to close at 7,123.33 Tuesday. This reduced total gains this year to 4.1 percent.
The heavier index, representing all shares, also tumbled 60 points, or 1.4 percent, to settle at 4,304.65, on a value turnover of P5.5 billion. Losers outnumbered gainers, 130 to 67, while 41 issues were unchanged.
All six sectoral indices declined, while only four of the 20 most active stocks ended in the green, led by STI Education Holdings Inc. which climbed 1.9 percent to P1.08 and Bloomberry Resorts Corp. which gained 1.7 percent to P6.59.
Conglomerate Ayala Corp. rose 0.8 percent to P793.50, while GT Capital Holdings Inc. of tycoon George Ty added 0.5 percent to close at P1,325.
Nickel Asia Corp., the biggest loser among the most active issues, plunged 7.2 percent to P6.59.
Meanwhile, Asian investors moved warily Tuesday as they looked ahead to a crucial week for two of the world’s top economies as Britain outlines its plans for leaving the EU and Donald Trump is sworn in as US president.
The UK is likely to pull out of the European Union’s single market for goods and services and seek a new trading relationship with the bloc, according to a person familiar with the matter. Separately, the International Monetary Fund is taking a cautious stance on the effects of a Trump administration.
“Trump’s policies and Brexit remain two key overhangs in Asia markets,” said Ronald Wan, chief executive officer at Partners Capital International in Hong Kong, “Investors may become more risk-averse and choose assets that could hedge these risks — commodities like crude oil, gold may be preferred in the short term.”
Britain’s pound edged up but remains stuck near three-decade lows against the dollar. Prime Minister Theresa May was due to set out her stall later Tuesday and analysts said forex traders will be poring over her remarks, with any surprises threatening to send the pound tumbling further.
Sterling was sitting around $1.2100 Tuesday, having plunged to $1.1986 Monday, its lowest since October’s “flash crash” that sent it to $1.1841—a level not seen since the start of 1985.
Friday sees Trump’s inauguration, which many are eyeing with uncertainty.
While world markets soared in the months after his November election win he has come up short when pushed to provide details of his spending and tax plans for the world’s number one economy.
There is also unease about his campaign rhetoric in which he promised to tear up trade deals and slap tariffs on China, which has already hit back at his comments, fueling worries of a possible trade war.
Jeffrey Halley, senior market analyst at Oanda, said in a note: “As we approach the 20th January investors, themselves are at a crossroads. Will his speech see a ‘Trump pump’ or a ‘Trump slump’?
“Do you position yourself continued for irrational exuberance or the coming of the Riders of the Apocalypse? It’s a tough question as Mr Trump’s actual policy announcements have been few, to say the least.”
On equity markets, Tokyo ended 1.5 percent lower with exporters hit by fresh gains in the yen against the dollar. The greenback bought 113.30 yen Tuesday compared with 114 yen Monday.
Sydney gave up 0.9 percent and Singapore was 0.4 percent lower while Wellington also retreated sharply. However, Hong Kong added 0.6 percent in the afternoon, Shanghai put on 0.2 percent and Seoul was 0.4 percent higher.
“We’ve had a strong rally in equities and we remain cautious,” Niv Dagan, Melbourne-based executive director at Peak Asset Management LLC, told Bloomberg News.
“There is a bit of angst and nervousness leading up to Trump’s inauguration and on the UK’s position in Europe. We expect this volatility to continue in the near term.” With AFP, Bloomberg