Shares outlook lower on dour US economic news
By Rocel Felix
Thomson Financial
First Posted 08:33:00 07/25/2008
MANILA, Philippines -- Shares may head south on Friday, dragged by steep losses on Wall Street due to renewed worries about the US housing and credit markets.
The Dow Jones industrials plunged more than 283 points or 2.4 percent on Thursday, led by financial stocks, after data showed existing US home sales slumped to a
10-year low in June and a jump in jobless claims renewed fears the world's largest economy is headed for a bigger downturn.
The rebound in oil prices may also be an excuse for investors hoping to lock in recent gains. A barrel of light, sweet crude rose $1.05 Thursday to settle at $125.49 on the New York Mercantile Exchange.
"We can expect some profit-taking after solid gains in recent sessions and the negative reaction to Wall Street," said Conrado Bate, president of online brokerage Citiseconline.
"But the market won't lose all of its gains. Despite concerns overseas, the sentiment here is much better. Investors are still looking for good value especially since the market was oversold."
Stocks to watch include food and beverage conglomerate San Miguel Corp. after it announced Thursday plans for a new corporate shake-up that may see it sell part of its core food unit and more of its flagship beer operations.
"The restructuring may require the divestment of part of our interest in our major subsidiaries through either an IPO or follow-on offering and strategic partnerships with existing partners and other industry leaders," Chairman Eduardo Cojuangco told a shareholders' meeting in Manila.
Globe Telecom Inc., the country's second biggest phone company, may also be in focus after it said it secured a P4 billion ($90 million) five-year loan facility to fund capital spending this year.
Globe, with a 38 percent of the mobile phone market against larger rival Philippine Long Distance Telephone Co., said in April it was setting aside $400 million to $450 million for capital expenditure in 2008.
On Thursday, Manila's 30-company composite index rose 72.97 points or 3.0 percent to 2,535.91.
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