Index drops on weak US, European stocks

MANILA, Philippines - A sharp drop in global and regional markets sapped investor confidence in the local bourse, dragging the main composite index down for the third straight session.

The Philippine Stock Exchange index slipped 1.37 percent or 88.95 points to close at 6,420.78, while the broader all shares index dropped 1.13 percent or 44.76 points to 3,922.28.

It is the first time the bellwether index sank to the 6,400 level since ending at 6,407.36 on July 11.

“A fall in US stocks overnight and an almost flat close in Europe left investors with little leads to actively trade local stock,” said Justino Calaycay Jr., analyst at Accord Capital Equities Corp.

Calaycay said the local stock market continued to ignore rosy economic picture painted by economic managers and international agencies.

For April Lee-Tan, vice-president and head of Research Department of COL Financial Group Inc., the local market was dragged by selling pressures in the regional markets.

On Monday, Wall Street failed to move to a new record high on weak volumes amid the summer vacation of several fund managers.

The Dow Jones industrial average dropped 0.3 percent or 46.23 points to 15,612.13, while the broader Standard & Poor’s 500 index lost 0.2 percent or 2.53 points to 1,707.14.

Close to home, Asian stocks closed mixed, with Japan’s Nikkei 225 adding one percent or 143.02 points to 14,401.06, while Hong Kong’s Hang Seng index shed 1.34 percent or 298.31 points to 21,923.70.