LOCAL STOCKS failed to sustain their climb on Tuesday, reflecting the performance of the Nasdaq index which fell as US technology shares tumbled on antitrust concerns.
The 30-member Philippine Stock Exchange index (PSEi) fell 139.51 points or 1.72% to close at 7,945.37 yesterday. The broader all-shares index was also down by 55.79 points or 1.13% to 4,883.22.
“The tech sell-off in the Nasdaq last night may have influenced the market sentiment in the PSEi today,” Jervin S. de Celis, equity trader at the Timson Securities, Inc., said on Tuesday.
The Nasdaq tumbled 1.6% on Monday, confirming a correction as it was dragged down by Alphabet, Inc., Facebook, Inc. and Amazon.com on fears the companies are the targets of US government antitrust regulators.
While the sell-off in the internet heavyweights was the biggest drag on the Nasdaq, the index has been falling steadily since its May 3 record closing high as investors worried about slowing global growth amid an escalating US-China trade war.
The Nasdaq Composite dropped 120.13 points or 1.61% to 7,333.02, which was 10.2% lower than its May 3 close. Meanwhile, the Dow Jones Industrial Average rose 4.74 points or 0.02% to 24,819.78 and the S&P 500 lost 7.61 points or 0.28% to 2,744.45.
Luis A. Limlingan, head of sales of Regina Capital Development Corp., said in a mobile phone message on Tuesday: “With the tech sector in possible violation of antitrust laws, regional markets entering correction, Philippine shares trading in overbought territory and a holiday approaching, it was only apt for most investors to turn into profit takers today.”
Timson Securities Mr. De Celis said foreigners also resumed their selling after the PSEi’s surge on Monday. Net foreign selling stood at P737.38 million yesterday, a reversal of the net inflows worth P1.43 billion recorded on Monday.
“Investors are also taking profits in index heavyweights ALI (Ayala Land, Inc.) and SMPH (SM Prime Holdings, Inc.) after rallying [on Monday] while the 2.6 million shares block sale made by JPMorgan at P1,238 in PLDT, Inc., which caused the stock to close lower by 8.39% [on Tuesday] has also urged foreign investors to sell around P437 million worth of shares,” Mr. De Celis said.
He said the performance of these three stocks contributed a total of 75.31 points to the 139.51-point decline of the PSEi yesterday.
All sector counters closed in the red, led by property which decreased 119.35 points or 2.67% to close at 4,348.70. Mining and oil went down 166.61 points or 2.23% to 7,280.01; services declined by 24.38 points or 1.44% to 1,662.92; financials dropped 23.36 points or 1.34% to 1,713.35; industrials lost 148.86 points or 1.26% to finish at 11,590.11; and holding firms lost 73.70 points or 0.96% to close at 7,591.10.
Some 599.75 million issues valued at P10.55 billion switched hands on Tuesday, slightly higher than the previous session’s P10.02 billion.
Losers outnumbered advancers, 113 to 84, while 40 names closed unchanged. — VMPG