The stock market plunged Wednesday on rising cases of COVID-19 and the reimposition of lockdown measures in certain parts of the country.
The Philippine Stock Exchange Index tumbled 156.30 points, or 2.5 percent, to 6,016.51 on a value turnover of P7.3 billion. Losers overwhelmed gainers, 166 to 48, with 32 issues unchanged.
Metro Pacific Investments Corp., which is into toll roads, water and electricity distribution, hospitals and infrastructure, fell 5.6 percent to P3.17, while major property developer Ayala Land Inc. dropped 4.5 percent to P32.
Universal Robina Corp., the biggest snack food maker, declined 4.4 percent to P119, while International Container Terminal Services Inc., the largest port operator and owned by tycoon Enrique Razon Jr., shed 3.7 percent to P93.
Meanwhile, fresh hopes for a coronavirus vaccine and another round of US stimulus lifted most Asian markets on Wednesday, although gains were tempered by the reimposition of lockdown measures and China-US tensions weighed on Hong Kong and Shanghai.
Tokyo, Sydney, Mumbai, Singapore and Wellington rose more than one percent, while Seoul, Jakarta and Bangkok also posted gains.
But Shanghai and Hong Kong suffered losses, with China-US relations—already hit by a series of issues including trade and Huawei—strained further by Donald Trump’s decision to remove Hong Kong’s special trade status, and his signing into law of an act authorising sanctions on banks over China’s clampdown in the city.
Investors took their lead from Wall Street’s pop higher, which came after US biotech firm Moderna said the final stage of human trials for a COVID-19 vaccine would start at the end of the month, after a report said first stage tests had been a success.
The news follows an announcement from Pfizer and BioNTech that two of four candidates for treatment had received “Fast Track” designation from US officials.
OANDA’s Jeffrey Halley said “significantly... the results have been published in a peer-reviewed journal, meaning independent eyes have been cast over the results, and like what they see.”
Providing added support was optimism the US would add to its stimulus after reports said top Republicans were reconsidering their opposition to it, including on extending supplemental unemployment benefits.
The trillions of dollars pledged by the US and other governments and central banks around the world have been a key driver of the rally in stock markets from their March lows.
And analysts expect that cash will probably fuel further gains, with Stephen Innes at AxiCorp saying even weak corporate earnings would be unlikely to derail that.
“A market that has ignored virus resurgence concerns and US-China tensions... is suddenly supposed to start worrying about earnings. That never made a great deal of sense to me.
“Sure, there may well be some profit-taking due to the run the market has been on, but we then go back to the wall of money argument time and time again. Booking profits are all very well and good, but the way this market seems to be heading, it is not clear you will be able to repurchase those stocks so readily again.” With AFP