PSEi stuck in 6,800 level

The local stock barometer remained in the doldrums for the third trading session on Tuesday as investors pared down exposure to emerging markets following Donald Trump’s rise to US presidency.

Giving up early gains, the main-share Philippine Stock Exchange index shed 14.33 points or 0.21 percent to close at 6,857.15, tracking mostly sluggish regional markets.

One notable decliner among PSEi stocks was Jollibee, which slid by 9.96 percent.

Jollibee reported on Tuesday a 6.1 percent year-on-year growth in third quarter net profit to P1.33 billion while nine-month net profit rose by 13.8 percent to P4.39 billion. Considering that the reported results were not bad, stock pundits said the selldown on Jollibee may be due to speculation of a reduction in its weight in the closely tracked MSCI.

Overall, the market was weighed down most by the industrial counter, which fell by 1.51 percent while holding firms and services counters traded lower.

The financial, mining/oil and property counters lightly gained.

Citigroup said comments from a US Federal Reserve (Fed) remained supportive of market expectations for a Fed hike by end of this year, noting that Fed fund futures suggested about 80 percent chance of a hike next month.

“Outlook for EM (emerging market) assets remains challenging. Investor concerns over tightening of global financial conditions and fear of capital withdrawals amidst heightened uncertainty are likely to persist. EM currencies and fixed income are likely to remain under pressure. The extent of positioning is likely to determine the pace of adjustment in the short term,” Citi said in a research note.

“Until further clarity emerges on the policies of President-elect Trump, precautionary cash balances are likely to rise across EM-focused portfolios,” Citi said.

Most emerging markets have fallen after America elected Trump, jittery over his isolationist and protectionist rhetoric during the campaign.

Value turnover for the day amounted to P7.7 billion. Market breadth remained negative, with 72 advancers being edged out by 112 decliners while 42 stocks were unchanged.

Meanwhile, Globe Telecom fell by 3.58 percent while AC and MPI both slipped by over 2 percent. ALI fell by 1.41 percent while PLDT, JG Summit and BPI also contributed to the decline.

DMCI gained 6.38 percent while Megaworld rose by 2.7 percent. URC and AEV gained by over 1 percent while SM Prime, GT Capital, BDO, SMIC and Metrobank all modestly gained.

One notable gainer outside the PSEi was Nickel Asia, which gained 4.2 percent.