Stocks, peso fall on lower growth, soaring oil prices

By Jenniffer B. Austria

THE local stocks and the peso started the week in the red as the discouraging second-quarter gross domestic product growth continued to dampen investors’ sentiments, while the new round of oil price hikes caused volatility in the foreign exchange.

The Philippine Stock Exchange index declined by 76.72 points, or 1.2 percent, to close at 6,329.19, while the broader all-shares index dropped 32.30 points to settle at 3,397.89.

Philstocks Financial Inc. research analyst Claire Alviar said the Pantheon Macroeconomics’ economic growth forecast downgrade to 4.5 percent from 5.5 percent weighed on sentiments. The suspension of reclamation projects in Manila Bay area also affected the property sub-sector which shed 2.13 percent.

Meanwhile, the peso fell to 56.78 against the US dollar Monday from 56.32 Friday as investors sought the safety of the greenback on expectation of higher cost of importing crude and petroleum. Meanwhile, Asian markets posted sharp losses in Monday trade, after falls in US tech stocks and as concerns over China’s property sector weighed on sentiment. Leading the losers in Hong Kong —where shares were down nearly two

Top Gainers

percent—was developer Country Garden, after it missed bond payments and warned of multi-billion dollar losses, deepening concerns over the nation’s heavily indebted real estate sector.

Its shares were down more than 17 percent as of 3:00 pm (0700 GMT).

Country Garden is a privately owned real estate giant named in Forbes’ list of the 500 largest companies in the world. Its boss, Yang Huiyan, was until recently one of the richest women in Asia.

The firm has long been deemed financially solid but was unable last Monday to make two bond payments, and after a 30-day grace period the company risks defaulting in September if it still cannot pay.

Like its heavily indebted competitor Evergrande, any collapse of Country Garden would have catastrophic repercussions for the Chinese financial system and economy. With AFP

AUDIO SHOW. Visitors examine products at the Hong Kong HighEnd Audio Visual Show inside the Hong Kong Convention and Exhibition Centre in Hong Kong on August 13, 2023. AFP