PSEi drops on renewed banking sector worries

PHILIPPINE STOCKS dropped on Thursday, mirroring Wall Street’s decline, amid fears of a global banking crisis.

The bellwether Philippine Stock Exchange index (PSEi) went down by 61.19 points or 0.94% to close at 6,404.91 on Thursday, while the broader all shares index declined by 34.70 points or 0.99% to end at 3,443.82.

“Philippine stocks fell, joining regional markets after overnight volatility in the West, as concerns about Credit Suisse prompted a global sell-off,” Timson Securities, Inc. Head of Online Trading Marc Kebinson L. Lood said in a Viber message on Thursday.

“The Philippine Stock Exchange Composite Index, declined after US stock markets mostly slightly declined overnight. Earlier, Credit Suisse stock price declined to record lows after its top shareholder, Saudi National Bank, ruled out adding to its stake,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Philstocks Financial, Inc. Research Analyst Claire T. Alviar likewise said the Credit Suisse issue affected sentiment.

“Investors were worried as the current issues in the banking sector may further worsen or other sectors may get affected negatively by these,” Ms. Alviar said.

US stocks pared losses on Wednesday, but the Dow and the S&P 500 still closed lower, as problems at Credit Suisse revived fears of a banking crisis, eclipsing bets on a smaller US rate hike this month, Reuters reported.

Credit Suisse troubles piled more pressure on the banking sector after US authorities relieved investors with emergency measures to prevent contagion after the collapse of SVB Financial and Signature Bank.

Some investors believe aggressive US interest rate hikes by the US Federal Reserve caused cracks in the financial system.

The Dow Jones Industrial Average fell 280.83 points or 0.87% to 31,874.57; the S&P 500 lost 27.36 points or 0.7% to 3,891.93; and the Nasdaq Composite added 5.90 points or 0.05% to 11,434.05.

Back home, all sectoral indices closed lower on Thursday. Financials went down by 30.54 points or 1.70% to 1,763.56; industrials declined by 124.33 points or 1.31% to 9,350.25; services dropped by 16.57 points or 1.05% to 1,561.42; mining and oil shed 117.70 points or 1.11% to end at 10,435.13; property fell by 19.85 points or 0.72% to 2,703.21; and holding firms lost 24.81 points or 0.39% to close at 6,207.39.

Value turnover declined to PHP 6.59 billion on Thursday with 1.04 billion shares changing hands from the PHP 11.07 billion shares with 1.19 billion issues traded on Wednesday.

Decliners outnumbered advancers, 145 versus 41, while 42 names closed unchanged.

Net foreign selling declined to PHP 362.77 million on Thursday from PHP 4.78 billion on Wednesday.

Timson Securities’ Mr. Lood placed the PSEi’s support at 6,250 and resistance at 6,550, while Mercantile Securities Corp. Head Trader Jeff Radley C. See put support at 6,000, 6,215, and 6,368 and resistance at 6,500 and 6,678. — Ashley Erika O. Jose with Reuters