Local shares open 2022 with losses as Omicron fears take hold

MANILA, Philippines — Local shares opened 2022 bleeding as investors succumb to fears over the fast-spreading Omicron variant.

The Philippine Stock Exchange index finished at 7,041.27 on the first trading day of the year, dropping 1.14%. The broader All-Shares index, meanwhile, sagged 1.05%.

Most sub-indices closed in the red except for mining and oil stocks, which gained 1.19%. Property firms posted the biggest loss after shedding 2.90%.

For Luis Limlingan, head of sale at local brokerage Regina Capital, surging infections, which reached 4,600 new cases on Sunday, scuttled investors in the local bourse.

"Philippine shares started the first trading session in the red amid the recent spike in the daily COVID19 cases seen across the globe, prompting investors to exit their positions," Limlingan said in a Viber message.

Daily cases surged globally in the past week as the world entered another year into the coronavirus pandemic. The renewed spike in infections are believed to be triggered by the less virulent but super-contagious Omicron variant, which is expected to figure as the dominant coronavirus strain around the world.

Much like Limlingan, Rastine Mercado, research head at China Bank Securities, agreed that local shares retreated due to the virus fears. The national government heightened restrictions around Metro Manila over the weekend, prompting health authorities to place the country as "high risk" for Covid-19 over surging infections.

"Market likely ended in the red as investors priced in the rise in case counts over the weekend and the government’s decision to revert Metro Manila back to Alert Level 3," Mercado said in a text message.

Regional equity markets were a mixed bag on the first trading day of the year. Singapore, Seoul, Taipei, and Jakarta rose while Hong Kong erased its early gains. Tokyo, Shanghai, Sydney, Wellington and Bangkok were closed for holidays.

At home, foreign investors sold P233.8 million more shares than they bought in the stock market. A total of 722.2 million local shares, valued at P4.26 billion, switched hands on Monday. — with AFP