By Denise A. Valdez, Reporter
LOCAL SHARES continued to drop on Tuesday as investors chose to stay on the sidelines ahead of the policy meetings of the US Federal Open Market Committee (FOMC) and the Bangko Sentral ng Pilipinas.
The benchmark Philippine Stock Exchange index (PSEi) dropped 43.62 points or 0.56% to close at 7,736.18 on Tuesday, while the broader all shares index fell 27.87 points or 0.6% to 4,610.01.
“The local market extended its decline today as investors remained cautious with their trading. So far, investors are in a tense situation while waiting for the central bank meetings this week particularly from the Federal Reserve and the Bangko Sentral ng Pilipinas,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a text message on Tuesday.
The US FOMC was scheduled to begin its two-day meeting yesterday, which investors expect will result to another rate cut.
The anticipation of the meeting dragged on other Asia Pacific equities on Tuesday, as Japan’s Nikkei 225 and Topix indices slipped 0.09% and 0.08%, respectively. Hong Kong’s Hang Seng index and Australia’s S&P/ASX 200 index likewise declined 0.22% and 0.34%, respectively.
Aside from the monetary policy meetings, the impending deadline of the implementation of US tariffs on Chinese goods on Dec. 15 also affected the market on Tuesday.
“We’re hearing mixed narratives from both countries but the bottom line is they don’t have a deal yet which increases the likelihood of tariff escalations on the said date,” Mr. Tantiangco said.
Most sectoral indices at the PSE ended in the red. Industrials lost 119.10 points or 1.23% to 9,531.24; financials dropped 22.84 points or 1.20% to 1,872.21; services decreased 10.36 points or 0.69% to 1,486.81; holding firms gave up 34.42 points or 0.45% to 7,613.61; and mining and oil shed 24.02 points or 0.31% to 7,513.15.
Only the property index went up, adding 22.3 points or 0.54% to end at 4,093.83.
Some 525.65 million issues valued at P3.87 billion switched hands on Tuesday, declining from Monday’s 576.20 million issues valued at P5.56 billion.
Stocks that declined outnumbered those that gained, 139 against 55, while 44 names ended flat.
Net foreign selling increased to P563.90 million from the P308.32 million logged in the previous session.
“The main index ended at its low again today as sellers continue to take it lower. Buyers have stepped back and are letting “weak hands” do their worst,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail on Tuesday.
“Next support is at 7,700 however, we may see it bounce back tomorrow and end above the 7,750 major support level,” he added.