By Arra B. Francia, Reporter
LOCAL EQUITIES fell on Wednesday as investors chose to pocket profits ahead of trade talks between the United States and China, as well as the upcoming decision of the US Federal Reserve.
The 30-member Philippine Stock Exchange index (PSEi) stumbled 0.88% or 70.87 points to close at 7,979.95 yesterday. The broader all-shares index likewise dropped 0.66% or 32.19 points to 4,824.53.
“The lack of fresh catalysts in the local market prompted the investors to take profit today. I believe the market is still in a wait-and-see mode as they await the updates in the US-China trade talks which will resume [Wednesday] until Thursday,” Unicapital Securities, Inc. technical analyst Cristopher Adrian T. San Pedro said via text.
US officials will be meeting with Chinese Vice Premier Liu He on Wednesday and Thursday as both parties try to arrive at a deal before the March 1 deadline of their 90-day truce. This comes amid the charges filed against Chinese tech giant Huawei and its chief financial officer, Meng Wanzhou.
Investors were also seen to be on the sidelines before the Federal Open Market Committee concludes its two-day policy meeting. Analysts see the body keeping rates unchanged.
“With the index finally showing weakness today and failing to close above the 8,000 mark, initial support is in the 7,800 area. Look out for how US markets move tonight especially with the upcoming Fed decision — consensus expects rates to remain steady,” Papa Securities Corp. sales associate Gabriel Jose F. Perez said in an e-mail on Wednesday.
Wall Street indices ended mixed ahead of the Fed’s decision. The Dow Jones Industrial Average gained 0.21% or 51.74 points to 24,579.96. The S&P 500 index declined 0.15% or 3.85 points to 2,640, while the Nasdaq Composite index edged lower by 0.81% or 57.40 points to 7,028.29.
Despite the market’s weakness back home, foreign investors remained net buyers at P843.95 million, versus Tuesday’s net purchases worth P795.76 million.
All sectoral indices moved to negative territory, led by services which plunged 2.15% or 34.72 points to 1,577.12. Financials shed 1.15% or 21.33 points to 1,823.08; industrials dropped 0.86% or 101.98 points to 11,636.93; mining and oil slipped 0.37% or 32 points to 8,469.24; property went down 0.23% or 9.28 points to 3,944.25; while holding firms dipped 0.22% or 18.05 points to 7,893.07.
Some 2.38 billion issues switched hands valued at P9.62 billion, higher than the previous session’s P8.21 billion.
Decliners outpaced advancers, 117 to 84, while 47 names were unchanged.
“In the short term, I expect the index to range between 7,818 support and 8,143 resistance with the possibility of testing 7,700 if the bearish momentum continues,” Unicapital’s Mr. San Pedro said.
