Philippine stocks fall as Fed pursues tapering


Philippine shares retreated for the second day in a row as investors saw a looming hike in interest rates after the United States Federal Reserve decided to pursue its asset tapering moves.

Analysts Gregg Ilag at AB Capital Securities Inc. and Head of Research Rafael Supangco at Angping and Associates Securities Inc. said that continued US Fed asset tapering affected Thursday’s trading, with investors cashing out for fear of sooner-than-expected increases in interest rates.

Supangco said some investors took a “risk-off stance.”

Aside from the Fed tapering, the planned end to the quantitative easing policy was announced earlier than previously expected, causing investors to take profit, Ilag said in a text message.

Ilag added that today’s market continued to move sideways, “as bargain-hunting was offset by repositioning after the Fed statement.”

“Our PSEi target is 6,700 [points, and] we think gains are marginal from this point going forward given the lofty valuations and susceptibility to externally driven selloffs,” Ilag said.

The Philippine Stock Exchange index (PSEi) shed 0.07 percent or 45.14 points to finish at 6,417.35, while the wider all shares index eased 0.89 percent or 34.87 points to 3,872.84.

The services counter ended as sole gainer among the sectors, showing a 0.61-percent increase or 11.67 points to 1,922.61.

Financials dropped 0.68 percent or 10.48 points to 1,541.90, while industrials were down 0.98 percent or 97.70 points to 9,893.51. Holding firms slipped 1.51 percent or 89.85 points 5,864.18.

Mining and oil fell 0.30 percent or 43.45 points to 14,539.81, and property dipped 0.51 percent or 12.31 points to 2,418.75.

Only PLDT gained from the rest of the most active stocks which incurred losses. Most active losers were JG Summit Holdings, Alliance Global Group, Universal Robina Corp., Aboitiz Equity Ventures Inc., Aboitiz Power Corp., LT Group Inc., Ayala Land Inc., Ayala Corp. and SM Investments Corp.

Losers beat gainers, 107 to 46, while the number of issues that closed unchanged stood at 51. Total volume thinned to 891.5 million shares, while value turnover totaled P7.1 billion.

On Wednesday, the PSEi lost 0.06 percent or 4.06 points at 6,462.49, while the broader all shares index firmed 0.07 percent or 2.63 points to 3,907.71.


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