PHILIPPINE STAR/KRIZ JOHN ROSALES

STOCKS dropped on Thursday due to profit taking following their two-day climb and the release of data showing a weak performance by the manufacturing sector in January.

The 30-member Philippine Stocks Exchange index (PSEi) declined 76.22 points or 1.02% to end 7,382.77, while the broader all shares index skidded 26.87 points or 0.68% to 3,906.20 on Thursday.

“The local bourse pulled back as investors took profits out of its preceding two-day rally,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

Mr. Tantiangco noted that trading weakened, with value turnover at P6.75 billion with 1.69 billion issues on Thursday against the P7.84 billion with 1.53 billion shares that switched hands the previous trading day.

Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said weaker manufacturing activity in January affected market sentiment.

Manufacturing growth lost steam in January, as the impact of Typhoon Odette and the surge in coronavirus disease 2019 (COVID-19) infections hampered demand and production, IHS Markit said on Wednesday.

The IHS Markit Philippines Manufacturing Purchasing Managers’ Index reading slipped to 50 in January, from 51.8 in December 2021, ending four straight months of growth.

A reading of 50 indicates no changes in manufacturing conditions, while a reading above signals improvement and anything below suggests the opposite.

“Traders may also be on the watch of the US market after it had climbed by four days now, hitting resistance, and it too may fall subject to some interim corrective actions,” COL Financial Group Chief Technical Analyst Juanis G. Barredo said in a Viber message.

All three Wall Street benchmarks ended higher on Wednesday, rising for a fourth straight session after a turbulent start to the year, aided by upbeat earnings from Google-parent Alphabet and chipmaker Advanced Micro Devices, Reuters reported.

The Dow Jones Industrial Average rose 224.09 points or 0.63% to 35,629.33; the S&P 500 gained 42.84 points or 0.94% to 4,589.38; and the Nasdaq Composite added 71.54 points or 0.50%, to 14,417.55, Reuters reported.

Back home, all sectoral indices ended in the red. Property went down 51.32 points or 1.54% to 3,273.84; holding firms declined 107.94 points or 1.49% to 7,118.68; industrials retreated 59.72 points or 0.55% to 10,763; mining and oil fell 49.34 points or 0.47% to 10,346.72; financials lost 5 points or 0.28% to 1,741.50; and services slipped 0.72 point or 0.03% to 1,964.07.

Decliners outnumbered advancers, 115 against 83, with 57 names closed unchanged.

Net foreign buying dropped to P162.06 million from the P980.43 million logged on Wednesday.

“The index did reach its previous high of 7,475 which may have also placed resistance pressure on the market,” Mr. Barredo said.

He put the PSEi’s next resistance target at 7,800 and support at 7,280. — MCL with Reuters

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