MANILA, Philippines — Local shares followed Asian markets lower yesterday, echoing a decline on Wall Street amid concerns about a potential Russian military invasion of Ukraine.
The benchmark Philippine Stock Exchange index (PSEi) ended at 7,309.94, down 51.21 points or 0.70 percent, while the broader All Shares index slipped 32.74 points or 0.84 percent to close at 3,8660.20.
“Global risk-off sentiment weighed down the local market, as investors stay on the sidelines amid rising geopolitical tensions in Eastern Europe,” AB Capital Securities said in a commentary.
Philstocks Financial analyst Japhet Tantiangco said offshore worries weighed on investor sentiment. These concerns include the increasingly hawkish outlook of the US Federal Reserve for the year and the ongoing tension between Russia and Ukraine, which could fuel a surge in energy prices.
“Investors also showed disappointment as the restrictions in the National Capital Region were not eased,” he said.
Despite a steady decline in the number of new daily COVID infections, the government extended the Alert Level 2 status in NCR until end-February.
While geopolitical tensions in Ukraine kept investors wary of riskier assets, they were also watching out for the minutes from the US Federal Reserve’s latest meeting, that will be released on Wednesday and could give further clues to how fast US interest rates will rise.
The US central bank is expected to start raising its benchmark interest rate in March, and Wall Street expects as many as seven rate hikes this year after last week’s report that inflation jumped 7.5 percent in January, the fastest increase in four decades.
The Fed typically responds to high inflation by making borrowing more expensive, which slows spending and the pace of price increases.