Philippine stocks closed just shy of entering a technical correction on Thursday amid global market turmoil triggered by mounting concerns about a crisis at Credit Suisse Group AG.
(Bloomberg) — Philippine stocks closed just shy of entering a technical correction on Thursday amid global market turmoil triggered by mounting concerns about a crisis at Credit Suisse Group AG.
The Philippine Stock Exchange Index dropped nearly 1%, putting its loss from a January high to 9.7%, with Converge ICT Solutions Inc and Union Bank of the Philippines among the day’s worst performers.
The escalating banking crisis is raising the risk of a lending crunch that could tip economies into a recession and bite into remittances from Filipinos working abroad that contribute about 10% to the nation’s economy.
“If the US goes into a recession, it will affect the Philippine economy because it’s a major source of employment for our overseas workers and a major trading partner,”said Jose Vistan, vice president at AB Capital Securities.
Recession Fears Soar as Credit Suisse Woes Threaten Loan Crunch
Elevated domestic inflation and high interest rates are also curbing consumer spending and contributing to recent declines in Philippine stocks.
Global funds have sold a net $566 million of domestic equities so far this year. The selloff extended by $491 million this week through March 15 as Silicon Valley Bank’s collapse sparked a global risk off sentiment.
–With assistance from Manolo Serapio Jr..
More stories like this are available on bloomberg.com
©2023 Bloomberg L.P.