Philippine Stocks Lead Declines in Asia Amid Surge in Infections

(Bloomberg) -- The Philippine stock benchmark fell the most in Asia on Monday as investors dumped the nation’s equities amid escalating daily coronavirus infections.

“Investors are essentially liquidating their holdings” as the renewed spike in Covid cases and renewed mobility restrictions could derail economic recovery prospects, said Lex Azurin, an analyst at AB Capital Securities.

The Philippine Stock Exchange Index lost as much as 3.6% before paring its drop to close 2.6% lower at 6,552.46, the lowest level since Nov. 4. All but three of 30 index components declined, with Alliance Global Group Inc, Ayala Corp. and Megaworld Corp. each sinking more than 5%.

The surge in Covid-19 cases in the Philippines, with the second-highest infection count in Southeast Asia, comes after the nation was one of the region’s last to begin inoculations. In contrast, the recent outbreak that’s led to hundreds being quarantined in Hong Kong -- where a vaccination program is well underway -- hasn’t triggered a similar selloff.

Philippine Covid-19 cases surged in the last three days, adding 4,817 cases a day through Sunday, and marking the nation’s highest three-day average of new infections. The increase puts a clouds over the strength of Philippine economic recovery.

The Philippine stock index could fall to as low as 6,400 near term depending on the magnitude of daily infections as this could prompt a return to stricter virus curbs, Azurin said.

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