The partial disposition by listed conglomerate San Miguel Corp. (SMC) of its Manila Electric Co. (Meralco) shares triggered a market correction in the Philippine Stock Exchange (PSE) amid the absence of market-moving global and local economic news.
In a telephone interview, First Grade Finance Inc. Managing Director Astro del Castillo said that only the news regarding the Meralco shares sales by SMC, sell-off, given the size of the transaction, could have made the market sag since there was no other market-moving news.
“The market remains healthy even if it’s still in consolidation. It is actually good for it to consolidate more before it runs upward due to corporate earnings announcement,” del Castillo added.
Joey Roxas, president of Eagle Equities, agreed with del Castillo saying that Friday’s trade was concentrated on the shares of SMC and Meralco.
For his part, Jonathan Ravelas, chief market strategist of BDO Unibank Inc., said that the correction was caused by a profit-taking, after the index failed to try the 6,700-point level.
The PSE index concluded the week flat, falling slightly by 0.41 percent, or 27.33 points to 6,621.02, while the wider all-shares slumped by 0.48 percent, or 19.26 points to close at 4,032.08.
Joining the main index and wider all shares on the red side, majority of the sectors also registered losses. Financials counter registered the biggest decrease, plummeting by 0.98 percent, or 15.72 points to 1,595.30.
Property plunged 0.73 percent, or 19.24 points to close at 19.24 percent to 2,616, followed by industrial, which went down 0.62 percent, or 61.35 points to 9,858.85. Services counter was flat with a loss of 0.11 percent, or 2.14 points to 1,998.77.
Mining and oil, however, managed to slightly edge up by 0.57 percent, or 81.51 points to 14,369.94, while holding firms gained 0.06 percent, or 3.70 points to 6,103.35.
Total value turnover was more active ending at P26.56 billion, with decliners beating advancers this time, 85 to 55.
Beside Meralco, some of the most actively traded stocks were BDO Unibank Inc., Universal Robina Corp., Metropolitan Bank and Trust Co., Philippine Long Distance Telephone Co., Alliance Global Group Inc., SM Investments Corp. and Ayala Corp.
Meralco shares plummeted by 8.20 percent to P277, while San Miguel Corp. shares was down a bit by 0.30 percent to P87.50.
On Thursday, the local stock market escaped from its losing trend that was caused by investors getting cautious anew on global developments.
After a two-day slump, the PSEi finally managed to recover, climbing by 1.12 percent, or 73.63 points to 6,648.35, while the wider all-shares index which went 1.11 percent, or by 44.47 points to 4,051.34.