Party is over for Philippine stocks

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PSEi
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The Philippines Stock Exchange, darling for emerging market investors until recently, saw all its gains of 2013 wiped out by a steep slump of the main PSEi index which dipped into bear market territory on June 25.

The 27 per cent gain the PSEi posted this year has been erased, mainly as a reaction to the US Federal Reserve’s comment on the end of its stimulus programme and China’s evolving cash crunch. Global investors withdrew money from emerging markets and sent it back to the US, where the economy is starting to show signs of growth.

Three upgrades by major rating companies and the government’s drive to boost economic growth have failed to underpin the bullish sentiment, analysts say.

The sharp reversal saw the Philippines market plummet 19.7 per cent from its high in May 2013.

The index stood around 5,700 in June 25’s afternoon trading, some 4 per cent lower than the day before and below the 5,860.99 close on January 2, the first trading day of 2013.

However, the PSEi is not the only ASEAN index flirting with bear market territory. Thai stocks plunged over the past days as foreign investors pulled back on the biggest monthly net sales in almost two years, as did Singapore’s Malaysia’s and Indonesia’s which were all in red territory and headed further south on June 25.

 

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Reading Time: 1 minute

Click to enlarge

The Philippines Stock Exchange, darling for emerging market investors until recently, saw all its gains of 2013 wiped out by a steep slump of the main PSEi index which dipped into bear market territory on June 25.

Reading Time: 1 minute

PSEi
Click to enlarge

The Philippines Stock Exchange, darling for emerging market investors until recently, saw all its gains of 2013 wiped out by a steep slump of the main PSEi index which dipped into bear market territory on June 25.

The 27 per cent gain the PSEi posted this year has been erased, mainly as a reaction to the US Federal Reserve’s comment on the end of its stimulus programme and China’s evolving cash crunch. Global investors withdrew money from emerging markets and sent it back to the US, where the economy is starting to show signs of growth.

Three upgrades by major rating companies and the government’s drive to boost economic growth have failed to underpin the bullish sentiment, analysts say.

The sharp reversal saw the Philippines market plummet 19.7 per cent from its high in May 2013.

The index stood around 5,700 in June 25’s afternoon trading, some 4 per cent lower than the day before and below the 5,860.99 close on January 2, the first trading day of 2013.

However, the PSEi is not the only ASEAN index flirting with bear market territory. Thai stocks plunged over the past days as foreign investors pulled back on the biggest monthly net sales in almost two years, as did Singapore’s Malaysia’s and Indonesia’s which were all in red territory and headed further south on June 25.

 

Do you like this post?
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