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PSE index dips on heightened US-China tensions

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PHOTO BY SANTIAGO JOSE J. ARNAIZ

By Arra B. Francia, Reporter

THE MAIN INDEX closed relatively unchanged on Tuesday, as heavy foreign buying cushioned the negative sentiment from regional markets following heightened tensions between the United States and China.

The Philippine Stock Exchange index (PSEi) slipped 0.03% or 3.10 points to finish at 8,050.82, almost unchanged from the previous session amid sideways trading for most of the day. The broader all-shares index eked out a gain of 0.34 point to 4,856.72.

“The market refuses to go any lower because of heavy foreign buying. Weakness in western markets may continue to bring foreign money back into our market. We may break above resistance at 8,100 before the end of the week,” Eagle Equities, Inc. Research Head Christopher John Mangun said in an e-mail.




While foreign buying slimmed to P795.76 million compared to Monday’s P2.27 billion, Tuesday marked the ninth straight session of net foreign inflows for the local market.

The PSEi bucked the negative trend seen in international markets. The Dow Jones Industrial Average lost 0.84% or 208.98 points to 24,528.22. The S&P 500 index dropped 0.78% or 20.91 points to 2,643.85, while the Nasdaq Composite index also shed 1.11% or 79.18 points to 7,085.68.

In Asia, Japan’s Nikkei 225 went down 0.7%, while South Korea’s Kospi index also edged 0.2% lower. Hong Kong’s Hang Seng index dipped 0.16%, while the Shanghai Composite index declined 0.10%.

“Asian markets stumbled [on Tuesday] after the long-awaited China-US trade deal was dealt another blow after criminal charges were filed against China’s telecom giant Huawei,” Mr. Mangun added.

Aside from fraud charges against the company itself, the US Justice department also filed criminal raps against Huawei Chief Finance Officer (CFO) Meng Wanzhou.

Regina Capital Development Corp. Managing Director Luis A. Limlingan also attributed the PSEi’s decline to the fears on charges filed against Huawei.

“Philippine shares retreated mainly spooked by the Huawei charges and corporates being warned on weaker revenue from China. US filed criminal charges against Huawei and demanded extradition of CFO Meng,” Mr. Limlingan said in a mobile phone message.

Four sectoral indices moved to positive territory, led by holding firms which gained 0.47% or 37.49 points to 7,911.12. Financials followed with an increase of 0.19% or 3.52 points to 1,844.41. Industrials added 0.05% or 5.89 points to 11,738.91, while services picked up 0.01% or 0.3 point to 1,611.84.

In contrast, the property counter dropped 1.26% or 50.65 points to 3,953.53, while mining and oil dipped 0.21% or 18.58 points to 8,501.24.

Turnover improved to P8.21 billion after some 1.90 billion issues switched hands, lower than the previous session’s P9.13 billion.

Decliners outpaced advancers, 124 to 86, while 33 names were unchanged.