Share prices plunged on Tuesday’s trade as investors were rattled on the possible rate increase of the US Federal Reserve (the Fed), with the main index saw a fall of more than 200 points during the day.
The benchmark Philippine Stock Exchange index (PSEi) fell 175.94 points, or 2 percent, to close 8,059.60 points. Value of shares traded skyrocketed at P18.54 billion on 5 billion shares.
The main index is now in a correction stage, a technical term used when the index dropped more than 10 percent from its highs. The main index is now down at 11 percent from its high of 9,078.37 points, which was only achieved early this year.
Luis Limlingan, research head at Regina Capital and Development Corp., said the drop followed the overnight sell-off at the US markets in anticipation of the US Fed’s rate increase of about 25 basis points during its meeting in March
“We believe the BSP [Bangko Sentral ng Pilipinas] will leave policy rates unchanged. This decision may cause the peso to erode versus the US dollar and encourage the exodus of foreign funds once more,” Limlingan said.
Support for the main index is now seen at 8,000 to 7,850 points, the broker said.
All of the other subindices fell by an average of 2 percent, led by the All Shares index that dropped 100.31 points to 4,848.49, the Financials index fell 41.70 to 2,110.86, the Industrial index declined 225.37, the Holding Firms index shed 167.71 to 8,040.35 and the Property index lost 73.05 to 3,635.50.
Decliners led losers 176 to 53, and 37 shares were unchanged.
Most of the top-traded shares were down, led by property developer Ayala Land Inc. that lost P0.50 to P41, parent firm Ayala Corp. declined P73 to P937, Now Corp. was up P0.23 to P10.10, BDO Unibank Inc. fell P4 to P145, Metropolitan Bank and Trust Co. shed P2.45 to P85.10 and MRC Allied Inc. rose P0.09 to P0.65 and SM Investments Corp. rose P8.50 to P949.