Cautious trading continues

MANILA, Philippines–Local stocks continued to trade with caution on Wednesday due to concerns on oil price pressures and prospective US monetary tightening but the main index pared its losses to stay above 6,700.

The main-share Philippine Stock Exchange index (PSEi) slipped by 1.8 points, or 0.03 percent, to close at 6,703.13, weakening for the fourth session in a row. It declined to as low as 6,635.55 in intraday trade but reduced its losses at close.

This developed as escalating violence in Iraq triggered concerns on potential oil price increases, which is not good for an oil-importing country like the Philippines, according to analysts. At the same time, high valuations in the equity markets alongside speculations of potential interest rate increases in the United States kept some investors on the sidelines.

All eyes were likewise on the rate-setting meeting of the policy-making Monetary Board of the Bangko Sentral ng Pilipinas Thursday.

The day’s decline was led by Megaworld (-2.22 percent) while Energy Development Corp. and GT Capital both fell more than 1 percent. Shares of Ayala Land Inc., PLDT, SM Investments Corp., Ayala Corp., DMCI and ICTSI likewise declined.

On the other hand, the day’s decline was tempered by the gains made by Aboitiz Equity Ventures (+2.19 percent) while BDO, URC, Metrobank, Alliance Global Inc. and SM Prime also firmed up.

Value turnover for the day amounted to P7.17 billion. There were 53 advancers, which were swamped by 125 decliners, while 43 stocks were unchanged.

There was net foreign selling of around P534 million.

Across the region, equity markets were mostly lower ahead of the US Federal Reserve’s reports on monetary policy.–Doris C. Dumlao