Though it posted a decline in what is now considered a “bear market,” the Philippine Stock Exchange index (PSEi) is seen recovering soon as equities have reached their oversold positions.
Joseph Roxas, Eagle Equities president, said on Tuesday that the market landed in the “bear” territory, having gone down by more than 20 percent from its all-time high of 7,392.20 set on May 15.
“If [the market]fall 20 percent from its all-time high, that’s a bear market,” Roxas said.
But Summit Securities Inc. President Harry Liu said otherwise, stressing that even though there are still a lot of foreign selling pressure, the market is poised to rally soon from the expansion of its volume.
“We should see some rally [for the next days because]the value has expanded . . . a little bit bigger than the last few days, so it is a good technical sign that there might be some reaction to the market already. But it is only a reaction for an oversold condition,” Liu said.
He emphasized that the market volume rose to 4.2 billion shares and as much as P10.3 billion.
Liu added that the market’s performance of going down to as low as 5,600 points in the early part of the trading session and then rebounding to 5,700 points, is an indication that there is some buying support.
“We should have an expected rally very soon,” he said.
On Tuesday, the PSEi slumped by 3.05 percent, or 181.99 points to 5,789.06, while the wider all-shares index was down by 2.66 percent, or 97.94 points to 3,588.64.
Holding firms had the biggest fall, or by 4.33 percent, or 230.53 points to 5,091.94, while mining and oil came in second, registering a 3.15-percent drop, or 405.24 points to 12,468.20.
Industrial dipped by 2.76 percent, or 250.36 points to 8,815.69, and financials slid by 2.19 percent, or 33.54 points to 1,497.55.
The services counter plummeted by 2.85 percent, or 52.12 points to 1,778.47, while properties index fell by 2.81 percent, or 66.19 points to 2,291.01.
Only SM Prime, among the most actively traded shares, gained. The others like Philippine Long Distance Telephone Co., Ayala Land Inc., Ayala Corp., Metropolitan Bank and Trust Co., SM Investments Corp., Alliance Global Group, among others, registered losses.
Losers outnumbered gainers again, 168 to 18, while a mere 18 shares were unchanged.
On Monday, the PSEi went down to the 5,900-point territory for the first time in the year; it registered a decline of 3.41 percent, or 211.12 points to 5,971.05. Meanwhile, the broader all-shares index dropped by 3.52 percent, or 134.43 points to 3,686.58.