Stock Market

PSEi slips on risk aversion amid Greek debt talks

Posted on June 05, 2015

STOCKS closed mixed yesterday, with the Philippine Stock Exchange index (PSEi) paring losses, as investors awaited the outcome of negotiations between Greece and its creditors to avoid a default.

The PSEi slid 8.02 points or 0.11% to finish at 7,553.65.

The all-shares index, meanwhile, rose 8.64 points or 0.2% to end at 4,355.00

“The market fell by as low as 45 points due to the fact that investors were risk averse since there was no clear deal made in Greece yet,” Alexander Adrian O. Tiu, research analyst at AB Capital Securities, Inc., said in a phone interview.

“The market managed to recover for most of the day because it has managed to hold above the 7,500 level, encouraging bargain hunters to enter the market,” Mr. Tiu said.

Investors have set their sights on Greece negotiations ahead of Friday’s deadline for Athens to settle a €300-million payment due to the International Monetary Fund (IMF).

The European Commission -- the executive arm of the 28-member European Union and one of Greece’s three bailout monitors along with the IMF and European Central Bank -- said in a statement that there had been “progress” during the talks. Fears of a messy Greek exit from the euro area are growing, with its current €240-billion bailout program due to run out at the end of June, and a total of €1.6 billion in payments due to the IMF this month.

“There wasn’t enough game-changing news that will trigger a bounce.

The market is waiting for the end of the Greek debacle. Some brokerages were also downgrading companies after the first-quarter earnings season,” Luis A. Limlingan, business development head at Regina Capital Development Corp., said in a separate phone interview.

Financials lost 8.90 points or 0.51% to 1,731.82 and holding firms gave up 4.19 points or 0.06% to 6,671.33.

In contrast, services jumped 13.92 points or 0.66% to 2,111.05; mining and oil added 56.70 points or 0.4% to 14,303.92; industrials climbed 38.92 points or 0.33% to 11,688.65; and property inched up 3.69 points or 0.12% to 3,088.61.

Value turnover thinned to P6.94 billion after 610.47 million shares changed hands, from Wednesday’s P7.12 billion.

Advancers edged out decliners, 100 to 71, while 51 names were unchanged. Net foreign selling was logged at P1.02 billion, down from the previous session’s P1.07 billion.

“We’re seeing that more investors are becoming more bullish on a wider range of stocks. We’re seeing some cherry-picking, but there continues to be weakness in some large caps,” AB Capital’s Mr. Tiu said.

Today’s inflation data release will play a key role in determining the market’s direction, analysts said. The central bank earlier said that inflation likely settled within 1.6% to 2.4% in May.

“The chart is still on a downtrend... We need a major economic news to break out of this downtrend,” Mr. Tiu said. -- Krista Angela M. Montealegre