PH stocks drop 1.6 percent over growth worries, Asia FX eye Fed comments

ABS-CBN News

Posted at Jan 27 2021 03:01 PM

PH stocks drop 1.6 percent over growth worries, Asia FX eye Fed comments 1
The Philippine Stock Exchange building at the Bonifacio Global City, Taguig. February 18, 2020. Jonathan Cellona, ABS-CBN News

MANILA - The Philippine stock market fell 1.6 percent on Wednesday as weak export data raised concerns about the country's fragile economic recovery while broader emerging Asian shares were subdued after sharp losses a day earlier.

The PSE index fell 113.55 points or 1.63 percent to 6,863.61 while the broader All Shares index shed 37 points or 0.9 percent to close at 4,131.32.

Philippine stocks fell as trade data weighed on sentiment one day before gross domestic product figures are released. 

Philippine exports dipped 0.2 percent in December and imports fell sharply, resulting in the widest monthly trade deficit since March. 

"Trade trends will likely continue going into 2021 with a fragile global recovery expected to limit particular gains for the export sector," said Nicholas Mapa, a senior ING economist for the Philippines.

He added that imports should remain subdued as well due to weak local demand.

Meanwhile, a $10 billion airport deal in Cavite province that formed one of the biggest Chinese projects in the country was canceled. The governor of the Cavite province said the axing of the deal had nothing to do with China Communications Construction Co being blacklisted by the United States last August.

Currencies in the region traded flat to slightly higher as investors eyed Federal Reserve Chair Jerome Powell's news conference later in the day after the central bank concludes a two-day policy meeting. Analysts expect the Fed to stick to its ultra-easy monetary policy.

Many emerging markets in Asia fell sharply on Tuesday as investors tempered hopes for the quick passage of more US stimulus, which had boosted sentiment in recent weeks.

Elsewhere in regional stock markets, Jakarta's main index pared most of early losses to stand 0.1 percent lower on the day while shares in Singapore and Taiwan eked out marginal gains.

In a grim milestone, Indonesia surpassed a million confirmed coronavirus cases on Tuesday, while health experts believe the true spread of the virus in the country could be three times higher.