Market slips below 7,300 level

The local stock barometer returned to the doldrums Thursday, slipping below the 7,300 mark, due to jitters on the Chinese economy and uncertainties over the timing of US interest rate hikes.

The Philippine Stock Exchange index lost 65.75 points or 0.9 percent to close at 7,278.98, tracking other battered regional markets. For the four-day trading week, the PSEi lost a total of 129.46 points or 1.74 percent as the second quarter local corporate earnings season ended on a lackluster note.

There will be no trading at the local stock market today, which was declared a nonworking in celebration of the Ninoy Aquino day.

The PSEi’s decline on Thursday was led by the property counter which fell by 1.06 percent. The financial, industrial, holding firm and services counters also slipped.

The only sub-index that bucked the day’s downturn was the mining/oil counter which rose by 2.47 percent led by Semirara (up 1.5 percent). Semirara has a dominant 44.79 percent in the mining index.

Value turnover for the day hit P5.8 billion. There were 63 advancers, 95 decliners and 57 stocks unchanged.

Meralco led the PSEi lower, tumbling by 3.23 percent while GTCAP, AC, EDC and Jollibee all fell by over 2 percent. ALI, BDO, BPI, Metrobank and Megaworld were down by more than 1 percent. AGI, SMIC and PLDT also slipped.

MPI, JG Summit and URC also defied the day’s downturn.

“Second quarter earnings have been flat to negative suggesting a more selective approach toward portfolio building. Investors are also more cautious ahead of GDP (Philippine gross domestic product) figures,” local stock brokerage DA Market Securities said.

In the first quarter, the local GDP growth rate of 5.2 percent disappointed markets.

DA Market said uncertainty over the timing of interest rate hike by the US Fed and the yuan devaluation also continued to weigh down markets.

Based on the latest US Fed minutes, there was consensus that the US economy was nearing the inflection point where interest rates should rise. However, there was concern over lagging inflation and a weak global economy, which cast doubts on whether interest rates will indeed be raised by September as what most investors expect.

With PSEi breaking past 7,400 or the 300-day moving average, DA Market said the index might next test key support levels at 7,200 or 7,000.

“Holding the support implies continued consolidation with 7,600-7,700 as important resistance,” it said. Doris Dumlao-Abadilla