The benchmark Philippine stock index snapped a two-day advance and slipped back to the 7,800-point level on profit-taking and foreign selling pressure as the market waded through a consolidation phase.
Local shares also tailed the declines across Asian markets following Wall Street’s fall overnight.
Crown Asia Chemicals Corp. appeared to be insulated from the general decline, continuing to rake in gains after listing on Monday — now up 36.49 percent or 77 centavos at P2.88 at the close.
The Philippine Stock Exchange index (PSEi) dropped 0.90 percent or 71.50 points to 7,886.57, while the All Shares index dipped 0.70 percent or 31.67 points to 4,523.97.
“The market is in a correction phase, Miguel Agarao, investment analyst at Wealth Securities Inc., said, noting the foreign-led selling. “Weakness in Asian markets also affected sentiment on the Philippines because we’re part of the ASEAN basket.”
“If foreign selling persists, so will its [Philippine market’s] weakness,” he added.
Anton Alfonso, investment analyst at RCBC Securities Inc., saw the market pulled down largely by selling of the Henry Sy-led index heavyweights BDO Unibank Inc., SM Investments Corp. and SM Prime Holdings Inc.
The market seems to be waiting for fresh catalysts that could move prices forward, said Summit Securities Inc. President Harry Liu said.
“This is just part of a yearly cycle for the market. Usually, the second quarter is a consolidation [period]because [the market is]anticipating the six-month earnings results,” Liu said in a mobile phone interview.
He sees the consolidation phase lasting through the second and third quarters to pave the way for a strong market comeback toward the yearend.
But if the market bounces back to 8,100 points, the main index may set a new high, Liu said. He also expects the market to remain above 7,800 points.
Alexander Adrian Tiu of AB Capital Securities Inc. describes the market as “still jittery after disappointing US and Japanese macroeconomic data results. Also, traders have identified resistance at 8,000 points, leading to profit-taking near that level.”
He sees the market consolidating in the 7,800 to 8,000 range. “Earnings are poised to be drivers for the index to move out of consolidation,” Tiu added.
Except for services, mining and oil, which posted gains, the other subindices ended in the red, with financials heavily hit with a 1.37 percent loss at the close.
Actively traded stocks that posted losses included Jollibee Foods Corp., BDO Unibank Inc., Metropolitan Bank and Trust Company, Ayala Corp., Universal Robina Corp., GT Capital Holdings Inc., Ayala Land Inc. and Energy Development Corp. D&L Industries Inc. was also actively traded but ended flat.
Total trade volume for Tuesday stood at 1.47 billion shares, valued at P9.27 billion. Decliners outnumbered advancers 111 to 72, while 48 issues closed unchanged.
On Monday, the bellwether PSEi) inched up 0.14 percent or 10.82 points to 7,958.07. Equities trading will be shortened this week as local financial markets will be closed on Friday, May 1, in observance of Labor Day.