LOCAL STOCKS succumbed to profit-taking on Friday amid blurry Brexit negotiations, lackluster economic data from China, and developments in the US government’s push for further tax cuts.

The Philippine Stock Exchange index (PSEi) slipped 66.42 points or 0.78% to close 8,420.95, while the broader all-shares index declined by 36.68 points or 0.74% to finish 4,913.79.

“The combination of the political tensions in Europe [and] lackluster economic data from China [was] the main catalyst for the perceived overseas weakness of the market, even with robust corporate earnings gradually streaming in. Hence, the PSEi succumbed to profit taking once again today,” said Luis A. Limlingan, Head of Sales of Regina Capital Development Corp.

Negotiations between the United Kingdom (UK) and the European Union (EU) remains uncertain over the question of the governance of the Article 50 Withdrawal Agreement that will guarantee citizens’ rights on both sides of the border.

In a press conference yesterday, EU Chief Negotiator for Brexit Michel B. Barnier said that negotiations had hit a “deadlock” on UK’s financial obligations before exiting the bloc, prolonging the talks further.

Moreover, while the Chinese economy grew 6.8% in the third quarter of 2017, Mr. Limlingan said Beijing has been “slowly falling [year-on-year].” Data from the World Bank showed slowdown, slumping to 6.7% growth in 2016 from 10.6% recorded in 2010.

Meanwhile, Timson Securities, Inc. equities trader Jervin S. de Celis credited the profit taking to the passage of a US Senate budget resolution that will bolster President Donald J. Trump’s campaign promise of slashing taxes.

The US Senate has passed a budget vote that would allow Congress to bypass any opposing vote or filibustering from the opposing Democratic Party. Mr. Trump and Congress hope to put in place a package of tax cuts before January with the hopes of boosting economic growth, employment and wages.

“The US senate’s passage of a budget resolution triggered foreign investors to sell their shares in the local stock market,” Mr. De Celis said.

“The PSEi has also reached its all-time high recently so valuations are pretty expensive making investors pocket some gains ahead of the third quarter corporate earnings report on November,” he added.

All six sectoral indices ended the day in red. Mining and oil dropped 240.33 points or 1.83% to close at 12,932.01; industrials followed with a 110.78 point-decline (1.01%) to 10,820.63; financials slumped by 19.36 points or 0.93% to 2,067.90; property gave up 31.89 points or 0.81% to 3,920.68; holding firms decreased by 53.12 points or 0.61% to 8,683.79; and services slipped 1.97 points or 0.12% to 1,698.01.

Decliners outnumbered advancers 124 to 72 while 49 stocks remained steady.

Trading value was P10.17 billion on Friday, up from the P7.88 billion seen the other day as 906.29 million shares changed hands.

Net foreign selling persisted, increasing to P1.95 billion yesterday from Thursday’s P463.9 million.

The list of Friday’s 20 most actively traded stocks showed five gainers: SM Investments Corp. (0.98% to P979.50 apiece), Manila Electric Company (0.97% to P290.60), Metropolitan Bank & Trust Company (0.82% to P92.75), Philippine National Bank (0.86% to P58.60) and Lopez Holdings Corp. (0.34% to P5.86).

Decliners, on the other hand, were led by Ayala Corp (4.12% decline to P1,070 per share), GT Capital Holdings, Inc. (2.06% to P1,190) and Globe Telecom, Inc. (0.79% to P2,000). – Karl Angelo N. Vidal