Share prices fell for the second straight day Friday following a steep drop on Wall Street fueled by renewed fears that Russia will soon invade Ukraine, adding to long-running angst about the Federal Reserve’s plans to hike interest rates.
The Philippine Stock Exchange Index slipped 20.14 points, or 0.3 percent, to 7,418.79 on a value turnover of P7.4 billion. Gainers, however, beat losers, 94 to 86, with 53 issues unchanged.
PLDT Inc., the biggest telecommunications firm, dropped 2.6 percent to P1,782, while rival Globe Telecom Inc. of the Ayala Group, the second-largest, declined 3.2 percent to P2,700.
Fiber broadband provider Converge ICT Solutions Inc. decreased 2.5 percent to P27.80, but major property developer Ayala Land Inc. rose 2.4 percent to P39.65.
The rest of equity markets were mixed Friday. While tensions in Eastern Europe continue to absorb most of the attention, oil extended losses as traders grow increasingly optimistic of a deal on Iran’s nuclear program that could see it restart crude exports.
After a disappointing start to the year, investors are still to get their mojo back as they contend with a range of risk-off issues including Russia-Ukraine, soaring inflation, imminent rate hikes, supply chain snarls, and China’s COVID outbreaks.
And analysts warned the uncertainty will likely last for some time.
For now eyes are on the Russia-Ukraine border after Joe Biden warned Vladimir Putin’s forces could attack any time soon.
There had been optimism the crisis had passed after Moscow said troops were withdrawing but Western powers said there is no sign that is the case, while accusing it of preparing a “false flag operation” as a pretext for invasion.
Putin denies he is planning any incursion but investors remain on edge as observers warn such a move could have wide-ranging implications for the world economic recovery, particularly with Russia being a major energy exporter.
The mood was given a little help when Washington said Thursday that US Secretary of State Antony Blinken and his Russian counterpart Sergei Lavrov will meet next week if there is no invasion.
All three main US indexes ended well down, with the Nasdaq almost three percent off, though Asia fared slightly better.
Tokyo, Hong Kong, Sydney, Singapore, Taipei, and Wellington slipped, though Shanghai, Mumbai, Jakarta and Bangkok edged up slightly. Seoul was flat.
“For now, simmering frictions in Ukraine are keeping markets nervous and after (Thursday’s) glimpses of a risk of tone, news over the past 24 hours have turned sentiment decisively negative,” said National Australia Bank’s Rodrigo Catril.
Still, oil prices remain in their downward spiral, dropping again Friday after a two percent drop Thursday as it emerged that Tehran and world powers were edging closer to an agreement on its nuclear program.
A deal could see the return of hundreds of thousands of barrels of crude to the global market, providing a much-needed boost to supplies just as demand surges and uncertainty reigns in Europe. Both main contracts remain around their 2014 levels, however, and analysts expect them to break $100 this year. With AFP