Index plunges on weak global growth outlook

MANILA, Philippines - Local share prices fell yesterday following reports of IMF decision to cut anew its global growth forecast for the year.

The Philippine Stock Exchange index (PSEi) retreated 0.74 percent or 53.70 points to 7,185.68, while the broader all shares index picked up 0.52 percent or 22.38 points to 4,255.73.

“The local stock market went down following leads from international market. IMF’s decision to cut its global growth forecast pulled down Philippine shares,” said Alexander O. Tiu, research analyst at AB Capital Securities Inc.

The IMF on Tuesday reduced its global growth forecast for 2014 to 3.3 percent from 3.4 percent previously, and placed the growth at 3.8 percent next year.

As a result, the three main index in Wall Street ended in the negative territory. The Dow plunged 1.60 percent or 272.52 points, the Nasdaq fell 1.56 percent or 69.60 points, and the S&P 500 lost 1.51 percent or 29.72 points.

Tiu said the absence of local news failed to buck the downtrend seen in global markets.

Locally, it was a bloodbath as all counters finished in the red. Holding firms and industrial firms were the biggest losers, dropping 0.97 percent and 0.86 percent, respectively.

Market breadth was negative as decliners trampled advancers, 107 to 71, while 41 stocks were unchanged.

Investor participation fell as P8.30 billion worth of shares changed hands from P12.68 billion the previous day.