Market Retreats Amidst Tariff Concerns
Anxiety among traders regarding upcoming tariff negotiations between the United States and the Philippines weighed heavily on the local bourse on Wednesday, pushing the benchmark stock index closer to the 6,300 mark. By the market’s close, the Philippine Stock Exchange Index (PSEi) had declined by 0.11 percent, or 7.19 points, to settle at 6,318.23. The broader All Shares Index also retreated, losing 0.09 percent, or 3.49 points, to finish at 3,776.59. Overall, market data indicated that losing stocks outnumbered gainers, with 95 companies declining versus 87 advancing, and 62 companies closing flat. This reflected the prevailing cautious sentiment as a total of 800 million shares worth P4.66 billion changed hands, showing that while some trading activity occurred, the market lacked a clear positive direction.
Impact of US-Philippines Trade Negotiations
The primary driver for the day’s cautious sentiment was the anticipation of further developments concerning Washington’s upcoming tariff deadline on August 1. According to Luis Limlingan, head of sales at Regina Capital Development Corp., investors were in a “wait-and-see” mode, holding off on major moves until there was more clarity on the outcome. Complicating matters was the recent tariff deal between the two nations, where the Philippines successfully reduced its tariff rate on goods destined for America from 20 percent to 19 percent, while also offering zero tariffs on certain US goods.1 However, this seemingly beneficial agreement was tempered by a warning from Finance Secretary Ralph Recto, who cautioned that the deal could result in a significant annual revenue loss of up to P6 billion for the country, adding to the prevailing market anxiety.
Mixed Performance Across Key Sectors
The overall market dip was not felt uniformly across all sectors, with some experiencing steeper declines while others managed to record gains. The banking sector saw the steepest decline of the day, with major players like BDO Unibank Inc. and Bank of the Philippine Islands (BPI) seeing their share prices fall. Conversely, DigiPlus Interactive Corp. stood out as the most actively traded stock, climbing by 0.84 percent. The day’s trading saw a mixed bag of results for other key corporations, with International Container Terminal Services Inc. seeing a slight decline, while both PLDT Inc. and Ayala Land Inc. recorded gains. The varied performance across companies like Jollibee Foods Corp., which remained unchanged, and Ayala Corp. and Metropolitan Bank and Trust Co., which showed mixed results, further highlighted the cautious and indecisive nature of the market.
