Funds shift to 2nd liners

MANILA, Philippines—The local stock barometer faltered on Friday as investors took advantage of rich valuations to lock up gains from selective large-cap stocks.

The Philippine Stock Exchange index (PSEi) lost 30.28 points or 0.39 percent to close at 7,809.54. Elsewhere in the region, trading sentiment was mixed.

The PSEi’s decline was led by the services and property counters while the holding firms and mining/oil counters were also down. The financial and industrial counters posted modest gains.

In intra-day trade, the PSEi hit a high of 7,860.33 or a few notches away from the record intra-day peak of 7,862.91, which was touched last Feb. 25.

Value turnover for the day amounted to P8.7 billion. Despite the PSEi’s drop, market breadth was positive as there were 90 advancers against 77 decliners. This suggested that funds were rotating to stocks outside the PSEi as investors try to scout for bargains.

Ayala Land led the PSEi lower, declining 2.98 percent. ICTSI, PLDT and Jollibee also slipped.

Outside of PSEi, the notable decliners were Melco (0.78 percent), Security Bank (-1.81 percent) and Robinsons Retail Holdings (-1.14 percent).

On the other hand, index stocks Metrobank, Emperador, SM Prime, Metro Pacific Investments and GT Capital gained more than 1 percent. Ayala Corp., URC, Energy Development Corp., Alliance Global Group Inc., BDO and SM Investments Corp. also gained.

Outside of the PSEi, among the companies that benefited from the rotation of funds was Store Specialists Inc. (+1.12 percent).

“The market continues to sustain high levels, consolidating amid rotational movement in issues. Meanwhile, technical indicators show an easing from overbought to neutral. We recommend selective stock picking,” local stockbrokerage DA Market Securities said.

DA Market said the timing of the interest rate increase in the US was being closely monitored by international markets. It said the US Federal Reserve’s two-day policy meeting next week might provide firmer indication on whether the monetary tightening would be in June or later in the year. Doris C. Dumlao