Metro Manila (CNN Philippines, March 19) — It was a bloody Thursday at the Philippine Stock Exchange, with share prices taking their steepest fall in history shortly after the market reopened.
The stock market resumed operations following a two-day shutdown after Luzon went under “enhanced community quarantine,” as authorities scrambled to contain the spread of the novel coronavirus disease or COVID-19.
Shares plunged to 4,623.42 for the day, down by 13.34 from the previous session. At its lowest, the PSE Index plumbed 4,039.15 points, down by over 24 percent from the previous trading day, but it then staged a recovery that was sustained until closing time.
At the open on Thursday, shares quickly plummeted by 12.4 percent to 4,673.58, triggering a 15-minute trading halt in a bid to calm investors. That did not stop the massive selloff at the local bourse, with shares crashing to a midday low of 4,039.15.
Luis Limlingan, managing director of Regina Capital, said this was easily the biggest fall on record.
“Shares have plummeted as investors worried about the economic damage from the pandemic,” Limlingan said in a text message, adding that plunging world crude prices has added to “rising worries” of a potential global recession.
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Trading closed at 1 p.m. — two hours earlier than usual — as financial markets observe shortened work schedule. The PSE trading floor in Bonifacio Global City will remain closed, so trades are done remotely.
The Philippines was the the only country to shut down its financial markets due to the COVID-19 outbreak. This was the first trading day under enhanced quarantine protocols.
Markets in other countries have remained open despite huge losses, as the rising number of cases continue to spook investors. Local traders said market jitters would persist until they hear concrete strategies from the Philippine government in containing the pandemic.
All indices suffered double-digit declines, led by mining and oil companies whose valuations dropped by more than 17 percent. Banks followed with a 15.38 percent fall, as well as industrial firms (by 13.34 percent) and holding companies (13.11 percent).
The government early this week restricted movement and business operations in the entire Luzon, only allowing workers in critical industries like healthcare, food preparation, banks, groceries, and media to report to work while the rest were told to stay at home. Malls and offices have been shut, with the state appealing for work-from-home arrangements until mid-April.
From their levels at the start of 2020, local shares have plunged so far by over 40 percent.
Earlier this week, the government rolled out a ₱27.1-billion spending plan for those affected by the coronavirus pandemic. The Department of Finance also unveiled a $3 million (about ₱150 million) grant from the Asian Development Bank and a $100 million (about ₱5 billion) fast loan from the World Bank to soften the impact of the shutdown.
There are currently 202 cases of the disease in the country, with 17 deaths. Seven have recovered.
