The stock market plummeted Thursday to over eight-year low after reopening, following a two-day suspension prompted by the coronavirus pandemic.
The Philippines Stock Exchange Index slumped 711.95 points, or 13.3 percent, to 4,623.42 on a value turnover of P9.4 billion. It fell almost 25 percent after reopening before bouncing back later. Losers routed gainers, 211 to 8, with 21 issues unchanged.
The Philippines was the first in the world to indefinitely suspend trading after President Rodrigo Duterte ordered more than half of its population to stay home for the next month.
The Philippine bourse had suspended operations “until further notice” in response but quickly recalled its order and reopened the market on Thursday after the government exempted it from the lockdown.
It was the largest fall on record for the benchmark, Bloomberg reported.
“We were kind of expecting that the market would open quite low, especially after a two-day halt in trading,” exchange president Ramon Monzon said.
Monzon said he was in talks with Philippine regulators to implement new measures to stem market volatility, which could include additional intraday trading suspensions.
Jollibee Foods Corp., the biggest fast-food chain, plunged 24.7 percent to P91.10, while BDO Unibank Inc., the largest lender in terms of assets, dropped 22.7 percent to P85.
Conglomerate Ayala Corp. tumbled 22.8 percent to P394, while unit Ayala Land Inc. declined 20.3 percent to P22.95.
The rest of Asian equities sank again Thursday while the dollar surged as a European Central Bank plan to spend more than $800 billion to buy bonds failed to instill optimism in traders who fear that the world is heading for a virus-fueled economic catastrophe.
In what one analyst said could be a “game changer” for the coronavirus-wracked eurozone, the ECB’s so-called Pandemic Emergency Purchase Programme aims to give financial markets some much-needed liquidity as investors pull the plug on markets.
It said the 750-billion-euro ($820-billion) program was temporary and will be halted when the coronavirus crisis is judged to be over “but in any case not before the end of the year.”
After announcing the move, ECB boss Christine Lagarde tweeted that “extraordinary times require extraordinary action. There are no limits to our commitment to the euro.”
Those comments echoed the words of her predecessor Mario Draghi, whose pledge to do “whatever it takes” to preserve the eurozone was seen as a turning point in the region’s sovereign debt crisis.
Asian markets initially climbed on the news but soon tumbled as investors contemplate months of economic hardship with countries around the world in lockdown to prevent the spread of COVID-19, which has now infected more than 200,000 people and killed almost 9,000.
Seoul tanked more than eight percent, Singapore dived 4.5 percent and Hong Kong, Sydney, Wellington and Bangkok lost more than three percent. Tokyo ended down one percent, while Taipei and Jakarta crumbled more than five percent.
Mumbai and Shanghai were more than one percent lower.
The sharp losses were in tandem with a surge in the dollar as investors scrambled for cash to pay debts or just stash away. With AFP