The stock market fell slightly Thursday, joining the rest of Asia in extending a global sell-off on US interest rate hike fears.
The Philippine Stock Exchange Index slipped 9.52 points, or 0.1 percent, to 8,465.77 on a value turnover of P7.6 billion. Losers beat gainers, 110 to 84, with 49 issues unchanged.
Conglomerate JG Summit Holdings Inc. of industrialist John Gokongwei dropped 5.4 percent to P68.10, while Manila Electric Co., the biggest retailer of electricity, declined 2.3 percent to P329.
PXP Energy Corp., a unit of Philex Mining Corp., slumped 13.8 percent to P15.80, while MRC Allied Inc., which is into property development and power generation, sank 9,9 percent to P0.73.
Meanwhile, the volatility that kicked off February after a couple of weeks of calm has returned on worries that the strong US economy and Donald Trump’s tax cuts will lead the Federal Reserve to tighten borrowing costs more than previously thought.
The latest bout of selling came after new Fed boss Jerome Powell gave an upbeat assessment for the economic outlook as he appeared before lawmakers Tuesday. Similarly, markets went into spasms at the start of last month in reaction to a strong report on US jobs and wages growth.
Powell is due to speak on Capitol Hill again Thursday.
Adding to the unease are the relatively high valuations of stocks after a stellar 2017 and January, which saw some indexes hit record or multi-year highs.
“February finally cracked the volatility genie out of the bottle, and now the big question is: will he stay out for good?” Ryan Detrick, senior market strategist at LPL Financial, said in a note.
“The good news is that March kicks off two of the strongest months historically for equities, before we hit a period of seasonal weakness from May through October.”
On Wall Street, the Dow, S&P 500 and Nasdaq all ended sharply lower for a second successive day, and Asia again followed suit.
Tokyo finished 1.6 percent lower, with a stronger yen hitting exporters, while Sydney and Singapore each shed 0.7 percent.
Wellington, Taipei, and Kuala Lumpur were also well down.
However, Hong Kong recovered initial losses to edge up 0.1 percent having lost around two percent in the previous two sessions. Shanghai also rose, adding 0.4 percent.
Among the biggest losers were petroleum-linked firms, tracking their counterparts in New York, which were hit by data showing a bigger-than-expected rise in US stockpiles. Hong Kong-listed CNOOC, PetroChina and Sinopec were down between one and two percent, while Inpex in Tokyo sank nearly three percent.
Both main crude contracts have been taking a hit recently as a ramp-up in US shale production offsets the effects of a key Opec-Russia cap, while gains in the dollar against higher-yielding currencies make the commodity more expensive. Brent lost more than one percent and WTI more than two percent Wednesday but were mixed in Asia.
Stephen Innes, head of Asia-Pacific trading at OANDA, said: “Traders are hypersensitive to crucial inventories data, especially top-side builds, given the market’s refocusing on shale production output as the US remains on course to be the world’s largest oil producer.”