MANILA, 7 October — Philippine stocks continued to dive, establishing a new three-year low after an almost continuous retreat that was interrupted only by some bargain hunting on the part of local investors.
Lack of fresh news further dampened sentiment so that the composite index lost another 38.19 points or 3.4 percent before settling at 1,088.44 points.
Market turnover also suffered a great loss.
Actual trading was 55.08 percent slower as only 1.1 billion shares changed hands after foreign players unloaded most of their holdings the previous week.
Stock market analysts said the fate of the US economy is being closely watched as a possible US recession may send Asian countries tumbling further down.
But Allan Araullo, vice president of Regina Capital Development Corp., said “the volume is already so thin, it makes the market susceptible to a big decline.”
“The main concerns remain. We’re bracing for a global economic slowdown. Already, there are export companies laying off workers. That would translate to a possible tightening of belts. So investors are staying away from the market,” said Astro del Castillo, research head at A&A Securities. “There remains a fair amount of caution given the many uncertainties of the impact of the United States’ war on terrorism on global economies,” added BPI Securities investment analyst Spencer Yap.
Share prices surprisingly recorded gains last Thursday despite the fact that the day before, the Board of Investments said the country’s exports in August were the worst ever in over two decades.
However, Vincent Lazatin, vice president at Worldwide Investment Management Company of the Philippines which has a portfolio fund of 750 million pesos, said the steep fall of the country’s merchandise exports in August tempered the market’s gains. Other traders said the market had already discounted the slump in exports this year as the government has predicted a fall of up to 15 percent for the whole of this year from the 2000 level.
