• PH stocks drop on foreign selloff amid valuation concerns

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    Philippine shares ended lower on foreign investor-led selling triggered by valuation concerns in the US markets, while local investors ignored some positive corporate earnings results for the first quarter.

    Foreign funds were seen leaving an “expensive” market after it hit record highs in recent months, to search for other bourses where they can still take positions ahead of the curve.

    The Philippine Stock Exchange index (PSEi) dropped 0.68 percent or 53.06 points to close at 7,763.21, while the All Shares index slipped 0.62 percent or 28.11 points to 4,487.81.

    Lawrence C. Lee, Citisecurities Inc. vice president, said foreign sellers were pulling down the market despite a series of generally favorable corporate earnings results released earlier in the week.

    “Continuous foreign outflows are really putting a damper on our market. We’re really expensive and the PLDT problems will not help,” Lee said.

    Index heavyweight Philippine Long Distance Telephone Company has announced the company may be laying off about 450 workers by the end of the year to reduce costs and align the composition of its work force. PLDT, which has an 8.93 percent weighting in the 30-stock benchmark PSE index, has been in intense competition with Globe Telecom Inc.

    The stock, however, was spared from heavy selling in Friday’s trade.

    Overall, investors and traders were “worried about further downside pressure in the short term. 7,400 is [could be]a reality,” Lee said, although adding, should the market hit the 7,400 territory, it would be “good for the long term” as valuations would be lower.

    “Sentiment will change, but the big picture stays the same. Market crashes are needed for greater returns,” he said.

    First-quarter corporate earnings released on Friday included those of Asia United Bank Corp., East West Banking Corp., Max’s Group Inc., and Melco Crown (Philippines) Resorts Corp.

    Financials and services gained, while industrials led decliners with a 1.74-percent fall.

    At the close, other actively traded companies that advanced were Jollibee Foods Corp., Bank of the Philippine Islands and BDO Unibank. Top losers were Universal Robina Corp., Metropolitan Bank and Trust Company, GT Capital Holdings Inc., Ayala Land Inc., First Gen Corp., and SM Investments Corp.

    Decliners outnumbered advancers 101 to 71, while 57 issues stood unchanged at the close. Trade volume thinned to 745.49 million shares, valued at P6.83 billion.

    On Thursday, the main PSEi fell 57.37 points, or 0.73 percent to 7,816.27, while the wider All Shares index lost 26.06 points, or 0.57 percent to 4,515.92.

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