By Janina C. Lim, Reporter
LOCAL equities finished Friday in negative territory as investors took caution over the geopolitical tensions at home and abroad, particularly the continued worries over the US-China trade tensions and the attack on two oil tankers in the Middle East that was seen as a cause for the increase in oil prices.
The bellwether Philippine Stock Exchange index fell 0.77% or 61.56 points to close at 7,990.20 yesterday. Meanwhile, the broader all-shares index slid 0.59% or 29.21 points to 4,884.91.
Summit Securities, Inc. President Harry G. Liu said in a phone interview that the explosions on oil tankers in the Gulf of Oman caused “sudden pressure” in the market over fears that the price of crude oil will go up.
News reports said the United States, citing a report from its Intelligence unit, linked Iran to the attack, stoking fears of a conflict furthering between the two countries.
Regina Capital Development Corp. Managing Director Luis A. Limlingan also noted in a mobile phone message that oil futures surged after reports about the attack.
Overall, Mr. Limlingan noted that local stocks closed in the red this week “with geopolitical tensions headlining the fall.”
For one, Mr. Limlingan noted the US’s and United Kingdom’s separate pronouncements of implementing punishing measures against Hong Kong over possible extradition to China, including freezing US assets for those that force individuals into China.
In addition, investors also turned to the US-China trade spat amid the lack of other market catalysts.
“With little in the way of market-moving news, investors were searching for narratives and again weighing the potential impact of the U.S.-China trade war on policy and markets,” said Mr. Limlingan.
Nevertheless, Summit Securities’ Mr. Liu sees the index breaching the 8,100 “medium-term” resistance once positive developments make way between the US and China’s trade negotiations.
“If we break 8,100, we broke the resistance of the medium term where you can predict that the market can rise to up to 8,200,” Mr. Liu said.
Mr. Liu said that the collision between the Chinese and Philippine vessels at the West Philippine Sea may have also raised a concern.
On June 12, it was reported that a Filipino vessel, which was anchored at Recto Bank in the West Philippine Sea, sank after it collided with a Chinese vessel on the evening of June 9.
The incident was reported by Filipino fishermen in the vicinity, who said the Chinese vessel abandoned the submerged Philippine-flagged F/B GIMVER 1 that had 22 people on board.
Friday closed with more subsectors in the red. Holding firms plunged 1.41% or 107.96 points to 7,542.51; property slumped 0.85% or 37.06 points to 4,332.57; industrial went down 0.55% or 64.75 points to 11,731.32; and services inched down 0.15% or 2.60 points to 1,694.87.
On the other hand, mining and oil grew 0.74% or 52.44 points to 7,152.78 while financials rose 0.44% or 7.56 points to 1,742.79.
Decliners trumped advancers, 112 to 74, while 54 were unchanged.
Friday’s turnover was valued at P7.68 billion, down from the previous session’s P9.10 billion.
Foreign investors turned sellers, with net outflows at P388.12 million, reversing net purchases on Thursday at P318.98 million.