The stock market fell Wednesday after US President Donald Trump failed to give investors enough reassurance over the progress of China trade talks.
The Philippine Stock Exchange Index dropped 64.87 points, or 0.8 percent, to 7,947.47 on a value turnover of P4.6 billion. Losers beat gainers, 105 to 73, with 59 issues unchanged.
Jollibee Foods Corp., the biggest fast-food chain, declined 3.1 percent to P213.20, while Globe Telecom Inc., the second-largest telecommunications firm, lost 2.1 percent to P1,870.
Conglomerate Ayala Corp. fell 1.9 percent to P824, while DMCI Holdings Inc. of the Consunji Group was down 2 percent to P7.90.
The rest of Asian markets also sank on Wednesday, while violent Hong Kong protests show no sign of letting up.
In a much-anticipated speech on Tuesday, Trump went into election mode, hailing a strong economy and saying a trade deal was close but also warning that he could ramp up tariffs if he did not get his way.
Global equities have been on a roll for weeks on optimism the economic superpowers will hammer out a mini deal as the first part of a wider agreement.
However, with a planned signing ceremony between Trump and Xi Jinping seemingly put back to December from this month, and scant news on developments of late, traders are becoming nervous.
“We’re close. A significant phase one trade deal with China could happen, it could happen soon,” Trump said at the Economic Club of New York.
But he then warned: “If we don’t make a deal, we’re going to substantially raise those tariffs. He added “that’s going to be true for other countries that mistreat us too.”
The remarks were seen as a big letdown for markets, which had hoped he would provide some updates on the trade talks, after being jolted by Trump’s denial of China’s claim last week that the two had a plan to remove some tariffs as negotiations progress.
“The president avoided commenting on whether a rollback in tariffs is part of a phase one deal, merely saying that he will only agree to what is beneficial for US businesses,” said Stephen Innes at AxiTrader.
“At this point, the market may have to wait until the actual signing of a deal (or not) to get confirmation on tariff rollbacks. And while the markets are still in the demilitarized trade war zone, investors remain in tariff rollback limbo.”
Tokyo and Seoul each ended 0.9 percent lower, Shanghai shed 0.3 percent and Sydney fell 0.8 percent.
Singapore was off 0.8 percent, while Wellington, Mumbai Taipei and Jakarta were also down.
Also darkening the mood was concern about fresh unrest in Hong Kong after the city suffered a night of rage as months of protests enter a more violent phase.
Police on Tuesday warned that the rule of law in the territory was on “the brink of total collapse.”
Businesses were braced for another day of chaos, with the transport system partially closed and businesses shuttering and sporadic fighting breaking out.
Hong Kong’s Hang Seng Index plunged more than two percent, having dived a similar amount on Monday, with a small rebound Tuesday. With AFP