Index extends loss on Sabah conflict

MANILA, Philippines - The local stock market extended its loss to back-to-back trading days as territorial tensions between the Sultanate of Sulu and Malaysian authorities weighed down investor sentiment.

The benchmark Philippine Stock Exchange index closed flat, falling 0.07 percent or just 4.71 points to 6,637.56 as it pared losses near the closing bell. The index trailed by more than 70 points at the end of the morning session.

“I think the slight decline was influenced by tensions in the Malaysian Peninsula,” said Freya Natividad, investment analyst at brokerage firm 2Trade-Asia.com.

She said the tension spilled over the equities market and might also influence the volatility in the foreign exchange.

Followers of the Sulu Sultanate holed up in Lahad Datu in Sabah, stoking military raids in the area.

In regional markets, Asian stocks also closed in the red on news of timid service sector growth and tighter requirements in property purchases in China, the world’s second largest economy.

Locally, the broader All Shares index dropped just 0.04 percent or 1.48 points to 4,172.07.

Most counters were in the negative territory, led by mining and oil firms that declined 1.23 percent or 269.50 points to 21,612.72. The advancers were led by financial firms that rose 1.41 percent or 25.16 points to 1,810.75.