PHILIPPINE shares bled to their worst drop in 12 years, dragged by concerns following the World Health Organization’s (WHO) declaration that the new coronavirus disease (COVID-19) outbreak is now a pandemic.
The bellwether PSEi plunged 616.99 points or 9.71 percent to 5,736.27 at the closing bell. This is the lowest for the main index in almost eight years, when it closed at 5,636.59 on Dec. 18, 2012.
The local stock barometer’s drop of 9.71 percent is also its lowest drop since Oct. 27, 2008 when it dipped 13 percent, according to AAA Equities head of research Chris Mangun.
The market’s bloodbath also triggered the Philippine Stock Exchange to halt trading for 15 minutes from 2:53 p.m. to 3:08 p.m. after the PSEi shed 656.13 points or 10.33 percent.
This is only the second time that the “circuit breaker” was triggered since the measure was adopted in September 2008, during the Global Financial Crisis.
The first time was on Oct. 27, 2008, the PSE said.
“It was another day of harsh selloffs for local equities as the WHO declared COVID-19 a pandemic,” Regina Capital Development head of sales Luis Limlingan said.
The WHO is characterizing the COVID-19 outbreak as a pandemic, director general Tedros Adhanom Ghebreyesus said on Wednesday.
The coronavirus, which emerged in China in December, has spread around the world, halting industry, bringing flights to a standstill, closing schools and forcing the postponement of sporting events and concerts.
The WHO declared a public health emergency of international concern, its “highest level of alarm,” on Jan. 30 when there were fewer than 100 cases of COVID-19 outside China and eight cases of human-to-human transmission of the disease.
Now there are more than 118,000 cases in 114 countries and 4,291 people have died, Tedros said, with the numbers expected to climb.
“Investors reacted to the possibility of a lockdown in Metro Manila to contain the COVID-19 disease before we have a massive outbreak,” Mangun said.
“The sudden selling coupled with a lack of buying, sent prices into a freefall, something we have not seen since the last financial crisis. The general sentiment has gone from fear to hysteria with may continue until we see more evidence that the virus can be contained,” he said.
Foreign funds bought P3.515 billion shares and sold P4.289 billion for a net selling position of P773.900 million.
More than 981.127 million shares valued at P7.962 billion, changed hands. Losers led winners, 226 to 7, and 25 issues were unchanged. (GMA News)
