Bourse ignores BSP rate cut, falls for second week

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LOCAL SHARES on Friday ignored an expected boost to appetite from the Bangko Sentral ng Pilipinas’ (BSP) widely anticipated interest rate cut the preceding day and, instead, yielded to weakness on Wall Street and most other Asian bourses.

The Philippine Stock Exchange index (PSEi) fell 0.97% or 77.26 points to close at 7,819.22, snapping a very gradual three-day climb — down 0.659% from the week-ago 7,871.11 on Sept. 20 — while the broader all-shares index similarly shed 0.85% or 40.53 points to 4,728.81.

“Shares slid as traders monitored the latest trade developments and assessed a whistle-blower complaint against President Donald Trump that was released,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.

Democrats in the US House of Representatives have begun an impeachment inquiry against Mr. Trump for allegedly pressing his Ukrainian counterpart, Volodymyr Zelensky, to help US investigations on the US President’s potential 2020 political rival Joe Biden in return for badly needed military aid against neighboring Russia. Mr. Zelensky has denied any impropriety in his telephone conversation with Mr. Trump.

Thursday saw the three main Wall Street indices retreat: the Dow Jones Industrial Average by 0.30% or 79.59 points to 26,891.12, the S&P 500 by 0.24% or 7.25 points to 2,977.62, and the Nasdaq Composite index decreased 0.58% or 46.72 points to 8,030.66.

Most major Asian indices followed suit on Friday, with Japan’s Nikkei 225 and Topix indices down by 0.77% and 1.17%, respectively, Hong Kong’s Hang Seng giving up 0.33%, South Korea’s Kospi dropping 1.19%, India’s S&P BSE Sensex falling by 0.43% and Singapore’s Straits Times Index slipping by 0.01%.

Defying a region-wide drop, the Shanghai SE Composite edged up 0.11%.

Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said that technical factors such as the relative strength index (RSI) and moving average convergence divergence (MACD) dictated market appetite.

“While we remain a Buy on the index, we’ve been flagging the past few days that we would prefer to wait near its recent lows at the 7,620 level given the following technical indicators — RSI breakdown of uptrend and MACD Bearish Crossover,” Mr. Perez said in an e-mail.

An MACD bearish crossover indicates that sellers are gaining control and continued weakness is likely to persist, while the RSI measures whether stocks are in overbought or oversold conditions.

All six Philippine sectoral indices moved to negative territory, led by mining and oil which plummeted 2.63% or 241.74 points to 8,968.40. Property slumped 1.15% or 47.21 points to 4,068.62; holding firms went down 1.14% or 89.25 points to 7,723.44; services retreated 0.99% or 15.49 points to 1,544.02; industrial slipped 0.61% or 65.73 points to 10,556.72; while financials went down 0.22% or 3.99 points to 1,803.55.

Volume improved just slightly to 1.476 billion shares worth P5.925 billion from Thursday’s 617.197 million issues worth P5.785 billion.

Stocks that lost were more than double those that gained 133 to 57, while 43 others ended Friday flat.

Fifteen of Friday’s 20 most active stocks lost, led by the likes of AbaCore Capital Holdings, Inc. (down 8.25% to P0.89 apiece); Megaworld Corp. (6.89% to P4.46); International Container Terminal Services, Inc. (3.54% to P122.50); Alliance Global Group, Inc. (also down 3.54% to P10.90) and JG Summit Holdings, Inc. (2.65% to P73.50 each).

There were four that gained: Suntrust Home Developers, Inc. by 6.9% to P0.93 apiece; Century Pacific Food, Inc. by 0.57% to P14.10; Jollibee Foods Corp. by 0.55% to P220.20 and Eagle Cement Corp. by 0.13% to P15.72% each.

Foreign investors were net sellers for the third straight session at P464.096 million, though slightly smaller than Thursday’s P472.883 million. — Arra B. Francia