In the wake of Britain’s decision to leave the European Union last June 24th, President and Chief Executive Officer of the Philippine Stock Exchange (PSE) Hans Sicat said that the stock market is in a good position due to the country’s solid macroeconomic fundamentals.
Sicat adds that Brexit would have a negative impact on trading over ‘the next few days’ as it reflected a residual reaction to the unexpected results of the referendum. The impact may prevail over the course of a few days as markets slowly settle. He further explains that the PSEi will remain afloat over the medium term as the market is supported by solid economic fundamentals and the inherent strength of the local financial market.
Equity analyst at AB Capital Securities Inc. Victor Felix said that the local market remains strongly insulated against Brexit, citing that the exports to the UK account for only less than 1 percent of the total shipments from January to April this year. Imports from the UK are also at less than 1 percent while the total UK portfolio investments in the country are less than 2.4 percent. “As such, overall impact is seen to be limited,” he added.
Coming from a 6.9 percent GDP growth in the first quarter of the year, economic managers still expect a GDP growth of 6.8 percent or 7.8 percent at the end of the year.
