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Main index fails to recover above 7,700 mark

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Dragon and Lion dancers perform during the opening of trading at the new Philippine Stock Exchange headquarters in Taguig City on Feb. 19. — KJ ROSALES/PHILIPPINE STAR

By Arra B. Francia, Reporter

THE Philippine Stock Exchange index (PSEi) staged a last-minute recovery from a slump that marked much of Thursday, but still failed to finish above the 7,700 line as investors may have digested recent reports on the country’s economy that flagged the possibility of overheating.

PSEi ended Thursday down 110.89 points or 1.42% to close 7,682.24 — its weakest in nearly a year or since April 27, 2017’s 7,661.01 finish — while the all-shares index dropped 54.93 points or 1.16% to end 4,665.65.

PSEi had opened Thursday 1.33% weaker at 7,689.35, fallen by as much 3.28% to 7,537.42 in the afternoon and marked its highest point at 7,756.40.

The benchmark index ignored the rise of its Asian peers: Japan’s Nikkei 225 and TOPIX Index, Hong Kong’s Hang Seng Index, South Korea’s KOSPI Index, Shanghai Composite Index, the Straits Times Index and the Jakarta Composite by 0.15%, 0.03%, 1.40%, 0.25%, 0.85%, 1.12%, 0.46%, respectively.

One analyst pointed to recent warnings that March’s 4.3% inflation, which topped an official 2-4% target range for the entire 2018 and was the fastest in at least five years, could be a harbinger of overheating — meaning the Philippine economy cannot sustain its currently high growth rate. “With inflation getting over the 2-4% during the month of February and March, this has somehow affected the investors, mainly the foreign investors are selling at this point,” Diversified Securities, Inc. trader Aniceto K. Pangan said via phone, also noting a report by the World Bank saying that the Philippine economy is at the risk of overheating.

Five sectoral indices closed lower: property by 80.21 points or 2.21% to 3,539.49; holding firms by 147.81 points or 1.9% to 7,599.29; industrials by 190.97 points or 1.7% to 10,987.66; services by 18.81 points or 1.18% to 1,568.39, as well as mining and oil by 21.65 points or 0.20% to 10,696.01.

Only financials gained: by 9.92 points or 0.49% to finish 2,007.23.

Thursday’s list of 20 most active stocks showed only two gained: Bank of the Philippine Islands whose share price increased by 4.81% to finish P109 apiece and Metropolitan Bank & Trust Co. which added 1.27% to close P83.50 each.

Leading those that closed lower were Alliance Global Group, Inc.; Megaworld Corp.; JG Summit Holdings, Inc. and PLDT, Inc. which gave up 4.93% to P13.50; 4.89% to P4.28; 3.92% to P60; and 3.52% to P1,370 each respectively.

Thursday saw 1.82 billion stocks worth P11.76 billion changing hands, compared to Wednesday’s 1.1 billion worth P7.31 billion. Stocks that declined outnumbered those that gained nearly threefold at 171 to 58, while 31 were unchanged,

Foreign investors turned predominantly bearish, making Thursday end with P2.66 billion in net sales — the biggest outflow since March 29, 2017’s P6 billion — compared to Wednesday’s P443.24-million net buying.