THE MAIN INDEX retreated below the 7,500 mark on Friday to its lowest level in five days, though it rose for the fourth straight week.
The Philippine Stock Exchange index (PSEi) gave up 74.26 points or 0.98% to close 7,461.06 — though this was 1.27% more than Nov. 29’s 7,367.85 finish (Nov. 30 was a public holiday) — while the all-shares index slipped by 35.04 points or 0.77% to close 4,495.88.
Sought for comment, Astro C. del Castillo, managing director of First Grade Finance, Inc., cited “renewed fears on the slowdown of the US economy, the trade war within US and China.”
Referring partly to the better-than-expected six-percent November inflation rate reported last Wednesday that marked the first time this year that the pace slowed, Mr. del Castillo added that while “there are some positive news, somehow it was shrugged off by investors.”
“They opted to play it safe.”
For Harry G. Liu, president of Summit Securities, Inc.: “This market is just going through consolidation stage due to the recent fundamental development”, citing easing oil prices abroad and inflation at home.
“If this will… continue to next year… the market will start moving higher already.”
“The PSEi had a wild ride this week, jumping by a cumulative 4.56% in the first two trading sessions, sparked by the temporary trade truce agreed upon by (US President Donald) Trump and (China’s President) Xi Jinping over their weekend meeting,” RCBC Securities, Inc. analyst John Paolo D. Ayson said in a Stock Market Weekend Recap.
“However, from Wednesday onwards, the PSEi tumbled by 3.19% as markets became skeptical of the potential success of the trade détente, which was bolstered on
Thursday by the arrest of Huawei’s CFO in Canada, upon the United States’ request, for alleged violations of US-led sanctions against Iran,” he noted.
“The local market practically brushed aside better-than-expected November inflation of 6.0% released on Wednesday,” he noted.
“Week-on-week, the market managed to retain 1.27% of its gains, but returned below 7,500.”
Wall Street provided downward pressure as it reeled from worries about revived US-China trade tensions, with the Dow Jones Industrial Average falling 0.32% to 24,947.67 and the S&P 500 losing 0.15% at 2,695.95, although the Nasdaq Composite Index added 0.42% to 7,188.26.
While Asian bourses were mixed, RCBC Securities’ Mr. Ayson noted that “the Philippines sided with the losers”, with only one of the six sectoral indices — financials — gaining, by 4.89 points or 0.27% to close 1,795.29.
The rest fell: holding firms by 153.57 points or 2.06% to 7,289.78, mining & oil by 143.41 points or 1.67% to 8,411.23, services by 11.98 points or 0.84% to 1,412.29, property by 26.07 points or 0.71% to 3,646.26 and holding firms by 0.99 of a point or 0.009% to 10,841.52.
Stocks that declined trumped those that gained 110 to 80, while 42 others closed flat.
Friday’s list of 20 most-active stocks showed six that gained: SM Prime Holdings, Inc. by 1.41% to P36 apiece; Bank of the Philippine Islands by 1.13% to P94.25; Metropolitan Bank & Trust Company by 1.01% to P79.80; Pilipinas Shell Petroleum Corp. by 0.94% to P48.45; First Gen Corp. by 0.73% to 19.32 and International Container Terminal Services, Inc. by 0.53% to P94.50 each.
The 13 stocks that lost were led by ISM Communications Corp. (down 6.55% to P5.56 apiece); San Miguel Corp. (down 4.31% to P162.20); Ayala Corp. (down 2.57% to P910); Ayala Land, Inc. (down 2.74% to P40.75); Robinsons Retail Holdings, Inc. (down 1.38% to (P71.50); SM Investments Corp. (down 1.05% to P940) and Metro Pacific Investments Corp. (down 1.04% to P4.77 each).
Trading thinned to 2.321 billion shares worth P6.292 billion from Thursday’s 4.613 billion worth P7.186 billion.
Foreigners turned bearish, ending Friday with P261.776-million net sales that were a reversal of Thursday’s P128.343-million net acquisitions.
RCBC Securities’ Mr. Ayson noted that “[f]oreigners accumulated shares this week with a net foreign buying of P800 million”.
First Grade Finance’s Mr. del Castillo said: “We’re still optimistic toward the yearend.”
“Hopefully there’s another Christmas rally given the prospects for 2019 which could be better compared to this year,” he added, even as he noted: “Perhaps, we will consolidate… before we run up.”
For Summit Securities’ Mr. Liu, “Now that Christmas, hopefully… oil price will not go up anymore, the peso-dollar will… strengthen and… inflation is being addressed already… then this consolidation we’re going through now, eventually in the first quarter, hopefully, will reverse the market upward again for the long term”. — R. J. N. Ignacio