The first “Black Monday,” at least in the context of financial markets, occurred on Oct. 19, 1987, when the Dow Jones Industrial Average lost 508 points, or about 22.4 percent, in a single day. The second occurred on Sept. 29, 2008, and marked the beginning of the global financial crisis of 2008 to 2009. The simple view, particularly for oil-importing economies like the Philippines, is that lower oil prices are a good thing. Second, fixed-income instruments — bonds — issued by oil companies are popular with investors because oil companies tend to carry high debt loads as a matter of routine, and so their debt papers have correspondingly high returns. Low oil prices have a direct impact on the sustainability of these corporate bonds, which again reflects on the companies’ stock prices.

Source: Manila Times March 09, 2020 16:41 UTC