Stocks slumped for the third consecutive day Friday in another directionless trading and on prospects of a weaker economic recovery induced by the latest lockdown.
The Philippine Stock Exchange Index fell 37.46 points, or 0.6 percent, to 6,378.07 on a value turnover of P5.9 billion. Losers beat gainers, 132 to 64, with 47 issues unchanged.
DITO CME Holdings Corp., the third mobile phone firm, shed 2.7 percent to P10.22, while Metropolitan Bank & Trust Co., the second-largest lender in terms of assets, declined 2.4 percent to P44.45.
JG Summit Holdings Inc. of the Gokongwei Group dropped 2.2 percent to P53.90, while PLDT Inc., the biggest telecommunications firm, slipped 2 percent to P1,272.
The rest of Asian shares struggled to find clear direction on Friday after a week spent seesawing to match the prevailing momentum on Wall Street, where trade faltered overnight after tax hike reports.
Washington is said to be developing a plan to slap new levies on wealthy investors, including a near doubling of the tax on stock transaction profits to 39.6 percent for people earning more than $1 million.
Any tax plan faces a long process on Capitol Hill before becoming a reality, but analysts said the reports indicate hikes are very much in the mix in Washington.
President Joe Biden also called for an increase in corporate taxes to finance his $2-trillion infrastructure package.
The news hit 10-year US Treasury yields and the greenback while leaving all three main New York stock benchmarks down nearly one percent by the Thursday close.
It also sent jitters through digital currency markets, with Bitcoin dipping below $50,000 in Friday morning trade just days after clocking a record high above $63,000.
But “past instances of tax-related selling around capital gains tax hikes suggest any equity weakness is likely to be short-lived,” said Stephen Innes of Axi.
“The biggest problem might be a near-term liquidity drain as active traders and hedge funds pull back on a high-frequency activity to reevaluate strategy. But this should be a temporary speed bump.”
Tokyo le2md losses with the Nikkei down 0.6 percent by the close, finishing 2.2 percent lower for the week. Singapore and Bangkok also saw modest losses.
But Hong Kong saw gains of 1.12 percent by the closing bell, marking a 0.9-percent rise for the week.
Shanghai was up 0.3 percent for the day and 2.2 percent for the week while Seoul and Taipei also posted gains.
London was 0.2 percent down in the morning ahead of lackluster retail sales data expected later Friday.
“It’s highly unlikely that the first quarter of 2021 will see a positive number for consumer spending, given the 8.2 percent decline seen in January, and the fact that the UK has been locked down for all of the quarter,” said CMC Markets chief analyst Michael Hewson.
Oil benchmarks saw a rise after a two-day slump, though Innes warned signs of a diplomatic rapprochement between the US and Iran were putting downward pressure on prices, with expectations growing that Washington could ease sanctions on Tehran. With AFP