Note: Article updated to reflect market closing figures. Original story published thirty minutes after the stock market opened today.
The Philippine stock market plunged to its six-week low today, ending almost 8% down from yesterday’s closing.
The sharp decline followed the massive sell-off in Wall Street, which was triggered by sharp falls in the Chinese and European markets, a drop in US durable goods orders, and a warning by Alan Greenspan, former chairman of the Federal Reserve, that the US economy could go into recession this year.
The 30-company Philippine composite index finished down 263.84 points or 7.9% at 3,067.45.
It trailed the Dow Jones industrial average which shed off 416.02 points, its biggest one-day point loss since the day the stock market reopened after the September 11, 2001 attacks on New York and Washington.
Analysts interviewed by the Philippine Daily Inquirer said, however, that the decline in prices may bring in new buying opportunities for investors.
“The selloffs in the US and China markets have caused worldwide jitters. This is definitely a good reality check and for the Philippine market, it’s the major correction that we have been waiting for,” said Astro del Castillo, managing director at First Grade Holdings Inc.
“The country’s economic fundamentals are solid because of the appropriate policies set by the government,” said Ron Rodrigo, research head at Unicapital Securities.
I hope they are right.
Cross your fingers, everyone.
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