After a two-day rally, local equities ended in the red on Friday, weighed down by negative sentiment prevailing on the global markets.
Despite gaining in early trades, the Philippine Stock Exchange index (PSEi) capped the week with a 0.36-percent decline or 25.36 points to 7,003.22, while the All Shares index also went down by 0.31 percent or 12.81 points to 4,150.28.
The benchmark stock index has been bombarded by negative sentiment around the globe in the past few weeks, including various downgrades in global economic growth forecasts, the Hong Kong protests, and continuing strife in the Middle East.
Within the week, shares had a two-day rebound on bargain hunting after the market’s value plunged from more than 7,300 points to 6,900 points.
Alexander Adrian Tiu, analyst at AB Capital Securities Inc., said via phone interview that the market was mostly driven by foreign sellers who are still swayed by negative views of the global economy.
“The US markets are still shaky. If it weren’t for the Fed stating that QE [quantitative easing program]is extended, the US markets will be down for today. For the PSEi, this is just a manifestation of local and foreign investors wary about the global economy; a carry-over of negative sentiments,” Tiu said.
“Locally, we’re still very strong. Remittances are up, some indicators are up like the favorable inflation. For the succeeding weeks, the market will still be observing what’s happening across the globe and the Fed take on the QE,” he added.
Only financials and services were positive among the sectoral indices: Financials were up 0.05 percent or 0.84 points at 1,649.33, and services advanced 0.10 percent or 2.22 points to 2,138.40. Tiu said the services index increase was caused by the advance of PLDT and Cebu Pacific’s shares.
“Services were mostly driven by PLDT and Cebu Pacific. PLDT was down the past few weeks on the free internet announcement, so it’s more of regaining its value. Cebu Pacific on the other hand was a beneficiary of the lower prices of oil. Lower fuel cost means higher margins for them,” Tiu said.
Mining and oil led the decrease of the rest of the subindices on lower oil prices. It went down 1.79 percent or 286.02 points to 15,684.59, while the industrial counter declined 0.77 percent or 86.05 points to 11,144.34. Holding firms dipped 0.01 percent or 0.58 points to 6,090.78, and property plummeted by 1.06 percent or 28.99 points to 2,718.11.
Among active gainers were PLDT, Cebu Pacific, and Vitarich, while active decliners on the day included Aboitiz Power, Globe, and Ayala Land, each dropping between 1 percent and 3.5 percent by the close.
Tiu said the 3.49 percent decrease in Globe shares was a result of its head-on competition with PLDT, or in other words, that any increase of PLDT shares will result in a decrease of Globe’s shares and vice versa.
“The decline of Globe shares is more attributable to dynamics of Globe and PLDT. The market has matured. Any market moves of PLDT will affect Globe. It’s a clash of strategy between the two. And people are worried that the PLDT might eat up Globe’s market share in the next few months,” Tiu said.
Total traded shares amounted to 4.23 billion, valued at a whopping P28.49 billion.
Advancers were still higher than decliners despite the market dip, 94 to 88, while the unchanged numbered 39 issues.
On Thursday, the benchmark stock index was up 0.53 percent or 37.39 points at 7,028.58, while the All Shares index inched up 0.12 percent or 4.80 points to 4,163.09.