PHL shares enter bear territory on Ompong’s inflationary impact

Philippine shares traded lower in a sell-off on Thursday that plunged the market back into bear territory amid inflation jitters related to the destruction of crops and infrastructure by Typhoon Ompong.

The bellwether PSEi closed 86.50 points or 1.20 percent lower at 7,134.73. The broader All Shares shed 42.75 points or 0.96 percent to 4,411.96.

Asked if the market has entered bear territory, Asiasec Equities Inc. chief market strategist Manny Cruz answered, “Yes.”

The market retreated back into bear territory with the PSEi down 21.23 percent from its peak of 9,058.62 on Jan. 29, 2018.

“The market sustained a downtrend amid anticipation that inflation will be higher in September after the government released a report on the damages due to Ompong, which is higher than what was expected at around P12 to P13 billion,” Cruz noted.

The Department of Agriculture, on Wednesday, said the damage incurred by the agriculture sector from Ompong reached P16.76 billion.

“The damage by the typhoon could bring prices up further, sending jitters to the market,” Cruz said.

A recovery is expected at around 7,050 on the PSEi.

“The market will have a strong base for recovery at 7,050,” Cruz said.

Foreign funds bought P2.294 billion shares and sold P2.679 billion for a net selling position of P385.704 million.

More than 792.145 million shares valued at P4.588 billion, changed hands. Decliners led advancers, 113 to 82, and 33 issues were unchanged. —VDS, GMA News