Bargain-hunting breaks 2-day stock market slide

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INVESTORS engaged in last-minute bargain-hunting on Wednesday following sharp declines since the start of the week on worries over a US interest rate hike next month.

After dropping to an intraday low of 6,722.31 at the noon break, the main PSEi closed the session at 6,836.64, up 0.50 percent or 33.91 points. The wider All Shares rose by 0.26 percent or 10.94 points to 4,149.10.

Justino Calaycay Jr., head of marketing and research at A&A Securities Inc., noted there was bargain-hunting in oversold stocks after the market fell to the 6,700 level earlier in the session.

“A late surge erased the day’s losses, arresting a two-session slide by 265 points or 3.7 percent. Nevertheless, the cloud of pessimism continues to persist over the market,” Calaycay said in a market note.

The benchmark PSEi has been incurring losses as foreign funds flee from emerging markets, fueled by fears of US protectionism under a Donald Trump presidency that could hurt the local economy.

Concerns about taxing US companies that outsource jobs and could impact on the business process outsourcing (BPO) sector.

Calaycay noted the retreat to the 6,700 level “adds fodder to the view that posits a possible retreat towards the 6,200 to 6,300 points. If this ensues, 2016 trades will snap a series of annual gains of the market since the 48 percent slump in 2008,” he said.

Earlier, Luis Limlingan of Regina Capital Development Corp. said the market will be in bearish mode once the PSEi drops another 4 percent to the 6,480 level.

Among the actively traded shares, Ayala Land Inc., Metrobank, Ayala Corp., and Security Bank Corp. registered losses, while the gainers included SM Investments Corp., SM Prime Holdings Inc., and GT Capital Holdings Inc.

More than 1.03 billion shares were traded, valued at worth P6.67 billion. Decliners outnumbered advancers, 110 to 71, while 38 issues traded unchanged.

On Tuesday, the PSEi closed at 6,802.73, down 2.53 percent or 176.33 points, while the All Shares dropped 2 percent or 84.46 points to 4,138.16.

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