Philippine Stocks Decline Most in a Month as Outflows Increaseby
Philippine stocks slumped the most in a month as the prospect of higher interest rates in the U.S. spurred foreign outflows.
The Philippine Stock Exchange Index fell 1.8 percent to 6,772.92 in Manila, its lowest close since June 2014. The gauge has fallen for nine straight days, the longest stretch of losses in 14 years, while foreign investors pulled a net $65.8 million from the nation’s shares last week, the most in two months. SM Prime Holdings Inc., the country’s largest property developer by market value, led declines.
Futures contracts show a 62 percent chance of an increase in U.S. borrowing costs this year. Bangko Sentral ng Pilipinas left its policy rate at 4 percent on Thursday, as forecast by all 16 analysts surveyed by Bloomberg. Emerging-market stocks slid Monday as Europe’s worst terror attack in a decade spurred a shift out of riskier assets.
“Foreign investors have been pulling out money because of the looming U.S. interest-rate increase and the impact of slowing China,” said Rafael Palma Gil, a Manila-based trader at Rizal Commercial Banking Corp., which oversees about $1.8 billion in assets. “With the added uncertainty brought by the attacks in Paris, the anticipation is investors will become more risk averse and that the outflow could continue.”
SM Prime tumbled 3.8 percent, the most in almost eight weeks, while SM Investments Corp., the nation’s most valuable company, slid 2.1 percent. The 30-member Philippine equity index is valued at 16.6 times its projected 12-month earnings, compared with a multiple of 10.9 for the MSCI Emerging Markets Index.
With Parisians on edge less than a year after the Charlie Hebdo massacre, Europe is on high alert after at least 129 people were killed in more than half a dozen locations in the French capital.
(An earlier version corrected the MSCI Emerging Markets Index’s valuation multiple in the fifth paragraph.)