Stocks suffer biggest one-day fall for 2010

(By Doris Dumlao)


MANILA, Philippines--Local stocks Friday succumbed to their worst bloodbath this year as US President Obama’s plan to temper risk-taking among American financial institutions spooked Wall Street and sent shivers to emerging markets.

The main-share Philippine Stock Exchange fell 2 percent or 62.11 points to close at 3,023.47 on an across-the-board selldown of equities. Regional bourses also ended lower.

The most badly hit was the local financial sector, which declined 3.38 percent, followed by the industrial and property sectors, which slid 2.6 percent and 2.29 percent, respectively.

This developed as Obama announced plans to limit the size and scope of US banks and finance firms by preventing them from owning, investing in or sponsoring hedge funds or private equity funds. This was reported to be a bid to protect US taxpayers from bearing the brunt of costly bailouts as was seen during the recent financial meltdown.

“The fall is more technical in nature. Based on the movements of the Dow Jones Industrial Average the past few days, last night was the tipping point for risk aversion in the market. Nobody wants to hold stocks when central banks are poised to close liquidity taps and valuations are overextended,” said Jose Mari Lacson, research head of local stock brokerage Campos Lanuza & Co.Click here tor read more...