By Arra B. Francia, Reporter
SHARES fell on Monday as investors remained cautious following the global equity sell-off last week.
The benchmark Philippine Stock Exchange index (PSEi) dropped 1.11% or 78.26 points to 6,926.51 yesterday, failing to hold early gains which would have extended Friday’s recovery back to the 7,000 level.
The broader all-shares index likewise gave up 0.58% or 25.22 points to 4,276.58.
“I think the local market followed the overall sentiment across Asia particularly in China as the Shanghai composite hit a new low since November 2014. The investors remained cautious following global equity losses in the previous week,” Unicapital Securities, Inc. equity trader Cristopher Adrian T. San Pedro said via text.
Most regional indices fell on Monday due to lingering fears over the trade war between the United States and China, as well as the possible slowdown of the Chinese economy.
International indices also slipped to negative territory last week, with the Dow Jones Industrial Average plunging by more than 800 points on Wednesday, Oct. 10. The index managed to recover on Friday, jumping 1.15% or 287.16 points to 25,339.99. The S&P 500 index gained 1.42% or 38.76 points to 2,767.13, while the Nasdaq Composite index also rose 2.29% or 167.83 points to 7,496.89.
Regina Capital Development Corp. Managing Director Luis A. Limlingan attributed the decline to tensions between Saudi Arabia and the US, which could push up oil prices further.
“Philippine markets started the week on a bumpy note as some tension between Saudi Arabia and the US kept investors in a wait-and-see mode… Analysts and traders said the Saudi response could be read as a veiled threat to use its energy riches as a political tool. Key European allies has also added to the pressure,” Mr. Limlingan said in a mobile message.
The mining and oil counter was the lone sub-index that managed to post gains, adding 0.24% or 21.22 points to close at 8,796.65. The rest declined, led by industrials which slumped 1.71% or 181.29 points to 10,394.08. Services lost 1.09% or 16.26 points to 1,471.84; holding firms dipped 0.92% or 62.83 points to 6,734.09; property shed 0.54% or 18.88 points to 3,460.93; while financials went down 0.32% or 5.06 points to 1,544.80.
Some 542.16 million issues valued at P4.40 billion switched hands, dropping from the previous session’s P5.28-billion turnover.
Advancers outpaced decliners, 106 to 84, while 41 names remained unchanged.
Net foreign outflows persisted, rising slightly to P738 million from Friday’s P720.77 million.
“On a technical note, the relief rally from the low of 6,790 last week failed to hold above 7,000. Expect the market to range between 6,800 and 7,000 with the possibility of testing 6,700 and 6,575 support levels, assuming the bearish momentum persists,” Unicapital Securities’ Mr. San Pedro said.