Shares drop on concerns over new virus strain

shares drop on concerns over new virus strain - Shares drop on concerns over new virus strain

By Revin Mikhael D. Ochave, Reporter

SHARES ended in red territory on Tuesday as investor sentiment reeled from the recent discovery of a new coronavirus disease 2019 (COVID-19) strain in Britain.

The 30-member Philippine Stock Exchange index (PSEi) declined 22.5 points or 0.31% to end at 7,202.39, while the broader all shares index fell 36.2 points or 0.83% to close at 4,290.14.

Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a mobile phone message that the local bourse dropped as investors were worried over news of a new COVID-19 strain in Britain.

The World Health Organization (WHO) advised that the new and highly infectious variant of the new coronavirus is a “normal part” of the pandemic’s evolution, Reuters reported.

Based on data from Britain, WHO officials have found no evidence proving that the new strain makes people sicker or is deadlier than existing COVID-19 variants.

AAA Southeast Equities, Inc. Research Head Christopher John Mangun said the local market dropped due to massive selling earlier in the trading day due to worries over news on the new COVID-19 strain.

“Buyers were quick to pick up shares of blue chips that were sold down, while second liners and speculative issues also took a beating after the substantial rally that it has seen in the prior trading days,” Mr. Mangun said in an e-mail.

“Market participants may also be much more comfortable staying on the side lines over the upcoming holidays, thus the profit taking activity,” Timson Securities, Inc. Head of Online Trading Darren Blaine T. Pangan said in a mobile phone message.

Majority of sectoral indices at the PSE ended lower on Tuesday, with property being the only gainer, rising 22.88 points or 0.62% to end at 3,708.06.

Mining and oil retreated 231.33 points or 2.44% to 9,236.82; services dropped 25.78 points or 1.67% to 1,515.68; industrials went down 143.03 points or 1.51% to 9,299.63; financials shrank 17.43 points or 1.17% to 1,461.58; and holding firms decreased 7.6 points or 0.1% to 7,452.44.

Decliners overwhelmed advancers, 203 against 39, while 33 names ended unchanged.

Value turnover on Tuesday amounted to P10.09 billion with 22.72 billion shares switching hands, higher than the P8.49 billion with 33.48 billion issues during the previous session. Net foreign selling expanded to P743.02 million from the P104.76 million on Monday.

“The PSEi maintains its support at 7,200. However, it is getting more fragile by the day. We may see it continue lower before it recovers,” AAA Southeast Equities’ Mr. Mangun said.

“In the remaining days of the year, we’ll have to see if the 7,000 level holds. Otherwise, 7,300 may be considered the nearest resistance area,” Timson Securities’ Mr. Pangan said. — with Reuters

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