Even though the prospects for the local equities remain buoyant, the Philippine stock index welcomed the week with a 2-percent decline to fall deeper into the red as part of an ongoing consolidation phase.
“Technically, we were really ripe for a consolidation. We were at the same pace as other markets as well, most of which corrected,” Astro del Castillo, managing director of First Grade Finance Inc., said.
BDO Capital and Investment Corp. President Ed Francisco further said that it wasn’t really disappointing that the market has gone down a little because it needs to breath.
“Hindi pwedeng dire-diretso lang to go up significantly [the market couldn’t just go up significantly all the time]. Once in a while, it should take a breather so some people could also unload. It will just rest a little then it could go back,” he said.
“I don’t see any major factors. It’s good to see a bit of corrections kaysa naman tataas ng sobra tapos babagsak ng sobra [instead of going up so fast then falling immensely]. This is not a bad signal,” Francisco added.
He further mentioned that in the next few sessions, the market may still trend sideways as no major corporate announcements are anticipated.
The Philippine Stock Exchange index resumed its sideways trend, welcoming the week with a 2.36-percent plunge into the red, or 171.40 points to close at 7,097.51.
The broader all-shares index also remained in the red, losing 2.10 percent, or 93.70 points to 4,371.79.
Moreover, all the sector indices registered losses with mining and oil falling significantly by 3.73 percent, or 635.82 points to 16,397.64, followed by the property counter, which dipped further by 3.52 percent, or 106.63 points to 2,921.74.
Holding firms also fell 2.46 percent, or 161.25 points to 6,391.04, while industrial declined 2.10 percent, or 227.92 points to 10,627.24.
Financials erased 38.20 points, or 2.07 percent to 1,810.83, while services snapped by 1.05 percent, or 22.23 points to 2,098.97.
Total value turnover was at P9.05 billion, while advancers got dominated by decliners, 23 to 149.
On Friday, the local stock market plunged further in the red as investors’ attention were still on the quite unsteady overseas markets.
The benchmark index ended the session with another correction, falling 0.62 percent, or 45.47 points to 7,268.91. This followed the correction that occurred on Thursday.
In an interview, Hans Sicat, PSE president and chief executive officer, said that the correction that was seen on Thursday and Friday was an overreaction toward what happened at the Tokyo bourse, which went down by as much as 7 percent in one day.
Because of the decline, Sicat pointed out that other markets started to assume that there was a massive correction.
He added that there has not been a fundamental change in the still robust local stock market.