Bourse dips on tensions in Hong Kong, Argentina

Credit to Author: TYRONE JASPER C. PIAD| Date: Tue, 13 Aug 2019 16:25:46 +0000

THE stock market closed in the red territory on Tuesday as political tensions in Hong Kong and Argentina soured investor sentiment.

The benchmark Philippine Stock Exchange index dipped by 0.84 percent or 65.94 points to finish at 7,788.45, while the wider All Shares slid by 0.88 percent or 41.89 points to 4,742.22.

“Riots in Hong Kong have escalated, with protesters flooding the [Hong Kong International Airport], causing a major shutdown,” AAA Equities Head of Research Christopher Mangun said.

The ongoing protests in the former British colony and regional economic hub prompted airport authorities there to cancel all flights on Monday afternoon.

The protests, which began in March from residents’ disapproval of a controversial extradition bill that proposes sending criminal suspects to mainland China for trial, have since evolved into a defiant assertion of Hong Kong’s autonomy that saw violent clashes between demonstrators and the city’s police in recent weeks.

“Argentina also took a massive hit today, with its currency losing 15 percent of its value and the S&P Merval Index down more than 40 percent, making it the worst one-day drop going all the way back to 1950,” Mangun explained.

The Argentine peso finished at 57.30 to the US dollar on Monday (Tuesday in Manila) and the Merval index crashed by 38 percent at closing after pro-business Argentine President Mauricio Macri was defeated by populist candidate Alberto Fernandez in a party primary election.

Regina Capital Development Corp. head of sales Luis Limlingan agreed with Mangun, noting that investors were also digesting their possible impact on trading.

“Stocks dropped as political unrest in Argentina and Hong Kong hit investors already nervous about trade tensions,” he said.

All Asian markets fell on Tuesday, with Hong Kong recording the worst plunge at 1.99 percent.

In Manila, all sectors were down, except for holding firms and mining and oil, which climbed by 0.53 percent and 0.62 percent, respectively.

Volume turnover stood at 1.82 billion, valued at P8.58 billion.

Losers outnumbered winners, 157-53, while 42 issues remained unchanged.