Free Trial
AUSSIE BONDS

Firmer To Start, RBA’s Bullock Eyed

BONDS

NZGBs Back The Other Way

NZD

Gains As Equity Rally Continues

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

Typhoon Blows Philippine Stocks Off Their Feet, PSEi Enters Bear Market

PHILIPPINES

Foreign investors were net sellers of Philippine shares Tuesday, shedding a net $193.36mn in local equities, which represented the largest net daily outflow since Mar 9, 2021.

  • The figure was boosted by an element of catch-up activity, due to a closure of domestic financial markets on Monday, when strong risk-off tone drove a global equity rout. A wave of outflows swept across emerging Asia, as offshore investors were net sellers of Indian, Indonesian, Thai, Malaysian and Taiwanese stocks.
  • Fresh rounds of hawkish Fedspeak and the reverberations of market turbulence in the UK helped undermine sentiment at the start to the week, generating pent-up impetus for the Philippine markets, which were shut as a super typhoon hit the main Luzon island.
  • The authorities are assessing the scale of the damage wrought by typhoon Noru, but it has been confirmed that swathes of farmland have been affected. While the government refused to lower its growth target for the year, reports of widespread rice crop destruction fuelled concerns over existing food shortages, which risk accentuating price pressures and nudging the BSP towards a steeper tightening path.
  • Rapid peso depreciation amplifies pressure on the Philippine equity market as USD/PHP keeps refreshing all-time highs. This bites into local corporate earnings when converted into USD, likely keeping foreign investors on the sidelines.
  • The PSEi tumbled on the re-open on Tuesday, landing 3.8% lower come the closing bell and printing its worst levels since Oct 2020 in the process. The index has now shed more than 20% from its February high on a closing basis, entering bear market territory. Still, the RSI moved into oversold territory, which puts participants on the lookout for a rebound.

Fig. 1: PSEi Index vs. Philippine Stock Exchange Net Foreign Stock Investment

Keep reading...Show less
305 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.

Foreign investors were net sellers of Philippine shares Tuesday, shedding a net $193.36mn in local equities, which represented the largest net daily outflow since Mar 9, 2021.

  • The figure was boosted by an element of catch-up activity, due to a closure of domestic financial markets on Monday, when strong risk-off tone drove a global equity rout. A wave of outflows swept across emerging Asia, as offshore investors were net sellers of Indian, Indonesian, Thai, Malaysian and Taiwanese stocks.
  • Fresh rounds of hawkish Fedspeak and the reverberations of market turbulence in the UK helped undermine sentiment at the start to the week, generating pent-up impetus for the Philippine markets, which were shut as a super typhoon hit the main Luzon island.
  • The authorities are assessing the scale of the damage wrought by typhoon Noru, but it has been confirmed that swathes of farmland have been affected. While the government refused to lower its growth target for the year, reports of widespread rice crop destruction fuelled concerns over existing food shortages, which risk accentuating price pressures and nudging the BSP towards a steeper tightening path.
  • Rapid peso depreciation amplifies pressure on the Philippine equity market as USD/PHP keeps refreshing all-time highs. This bites into local corporate earnings when converted into USD, likely keeping foreign investors on the sidelines.
  • The PSEi tumbled on the re-open on Tuesday, landing 3.8% lower come the closing bell and printing its worst levels since Oct 2020 in the process. The index has now shed more than 20% from its February high on a closing basis, entering bear market territory. Still, the RSI moved into oversold territory, which puts participants on the lookout for a rebound.

Fig. 1: PSEi Index vs. Philippine Stock Exchange Net Foreign Stock Investment

Keep reading...Show less