MANILA, Philippines ? Local stocks fell sharply on Friday largely due to the cash dividend payment of telecommunications giant Philippine Long Distance Telephone Co. and the unwinding of monetary relief measures by the Bangko Sentral ng Pilipinas.

Delinking from an upbeat trading in Wall Street overnight, the main-share Philippine Stock Exchange index tumbled by 52.65 points or 1.68 percent to close at 3,072.91.

Although the decline was across the board, the most battered were the services and industrial counters whose indices fell by 3.5 percent and 1.8 percent, respectively. As such, the main index fell below the crucial 3,100 mark.

There were only 28 advancers as against 58 decliners and 75 unchanged stocks. Value turnover at the local bourse was thin at P2.23 billion.

The index was dragged down by heavyweight PLDT stocks whose share price fell by 4.5 percent to P2,560 and accounted for about a fifth of the value turnover. Yesterday was the ex-dividend date of PLDT, the date when investors must be on its books to receive dividends.

"It's not so much that investors are dumping PLDT shares but when cash comes out as dividends, it reduces the equity value," said Jose Mari Lacson, head of research at local brokerage Campos Lanuza & Co.

Aside from the PLDT factor, Lacson said the market had also fallen to discount the unwinding of an accommodative monetary policy by the BSP.

On Thursday, the BSP maintained its key policy rates at historic lows but withdrew some of the so-called ?crisis-relief? measures that were earlier implemented to help avert a recession. Among others, it reduced the rediscounting window to P40 billion from P60 billion.

Under the rediscounting facility, the BSP extends loans to a borrowing bank at an amount discounted from the latter?s collectibles. Discount loans are backed by a bank?s receivables.

Aside from PLDT, Universal Robina Corp., Ayala Corp., Energy Development Corp., First Philippine Holdings Corp., Megaworld Corp. and Globe Telecom Inc. also succumbed to profit-taking.

On the other hand, Belle Corp., Metro Pacific Investments Corp. and Alliance Global Group Inc. bucked the downtrend.

On the contrary, US stocks rallied overnight to send the Standard & Poor?s 500 Index to the highest level since October 2008, as Citigroup Inc. led a bank rally and investors speculated that healthcare reform will be harder to pass.