Negative sentiment from the US
Philippine shares continued on Wednesday to languish in volatile trading, aggravated by negative sentiment overnight on Wall Street.
The bellwether PSEi eased by 0.06 percent or 4.26 points to 7,546.01 at the closing bell. The broader All Shares rose by 1.96 percent or 89.42 points to 4,663.29.
Total trades reached 1.78 billion shares, amounting to P8.9 billion. Decliners outnumbered advancers, 110 to 67, while 50 issues were unchanged.
The market remains volatile, weighed by fears of an interest rate hike in the US and domestic politics, said Harry Liu, Summit Securities Inc. president.
“The market has softened to the 7,500 support level in the last few days. Initially, investors looked at the negative US markets and the local conditions – mostly on the political side – which caused the sell-off.
“But the market has been a bit oversold the past few days, that’s why some bargain hunting came in,” Liu said.
The extensive sell-off is “temporary,” given the strong fundamentals of the Philippine economy and the government’s efforts to address all pressing issues while working towards an inclusive growth.
“As of now, the investing public is just on the sidelines. This temporary decline is just for the short- to medium-term. The long-term is still very much intact on the economic side and the infrastructure spending, moving forward,” Liu said.
Liu noted substantial market moves that could reverse downtrend might start in November “when the third quarter corporate results come in.”
“I think the movements will be towards the third quarter reports … then the market players may engage … again.
He does not see the US Federal Reserve rate hike as a big crisis about to happen.
“Everyone is expecting an increase, but they don’t see that the increase will be insignificant because the Fed has to be careful.
“I don’t think there will be an increase. It may be likely pushed back towards the end of the year. But if there will be an increase, it will be insignificant,” he added.
On Tuesday, the PSEi declined by 0.42 percent or 31.52 points to 7,550.27, while the All Shares increased by 0.87 percent or 39.53 points to 4,573.87.