PSEi drops to 7,000 level on Trump win, GDP miss

The benchmark index plunged to the 7,000 level and hit a near two-month low on Thursday following slower-than-expected Philippine economic growth in the third quarter and as Republican Donald J. Trump won the US presidential election.

The Philippine Stock Exchange index (PSEi) dropped by 2.1% or 150.98 points to end at 7,014.44 on Thursday, while the broader all shares index went down by 1.97% or 78.33 points to 3,891.64.

This was the PSEi’s worst finish in nearly two months or since it ended at 6,944.88 on Sept. 11. The benchmark index also dropped below 7,000 intraday, hitting a low of 6,923.99.

“The local market plunged this Thursday. Investors priced in the negative implications of US protectionist policies on the global economic outlook as Mr. Trump wins the US presidential race,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

“Also weighing on investor sentiment was the slowdown in the Philippines’ third quarter gross domestic product (GDP) growth to 5.2%,” he added.

The Philippine economy expanded by 5.2% in the third quarter, slower than the revised 6.4% expansion in the second quarter and the 6% print in the same period last year. This was below the 5.7% median GDP growth forecast in a BusinessWorld poll of 12 analysts.

“Philippine shares slid anew as the third-quarter GDP figures came in much lower than expected at just 5.2%. Though private consumption continued to pick up, fixed investment and government consumption weakened as exports further declined,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“Meanwhile, US stocks rallied sharply on Wednesday, with major benchmarks hitting record highs following Donald Trump’s victory in the 2024 presidential election. Mr. Trump is perceived as favoring lower corporate tax rates, deregulation, and pro-domestic industrial policies, all of which could stimulate the US economy and benefit risk assets.”

Almost all sectoral indices closed lower. Property went down by 3.93% or 108.90 points to 2,656.43; mining and oil declined by 2.59% or 219.83 points to 8,262.81; industrials retreated by 2.25% or 224.45 points to 9,712.17; financials dropped by 2.1% or 49.09 points to 2,282.48; and holding firms decreased by 1.9% or 116.86 points to 6,015.38.

Meanwhile, services inched up by 0.04% or 1.07 points to 2,163.43.

Value turnover increased to PHP 9.72 billion on Thursday with 1.11 billion shares traded from PHP 4.66 billion with 1.34 billion issues changing hands on Wednesday.

Decliners overwhelmed advancers, 167 versus 46, while 40 names were unchanged.

Net foreign selling ballooned to PHP 3.9 billion on Thursday from PHP 1.12 billion on Wednesday. — Revin Mikhael D. Ochave