Local stock price barometer weakens ahead of crucial Opec meet

The local stock barometer slipped Monday as regional markets traded with mixed sentiment ahead of a closely watched Organization of Petroleum Exporting Countries (Opec) meeting.

The main-share Philippine Stock Exchange index (PSEi) lost 64.38 points or 0.93 percent to close at 6,825.40.

Global markets are closely watching the Opec meeting on Nov. 30 given its potential impact on oil supply that, in turn, could influence global pricing of crude. Financial markets are expecting a firmer production cut agreement to be tackled. Ahead of the Opec meeting, oil prices were sluggish.

At the local market, the day’s decline was led by the industrial and holding firm counters, which both slid by more than 1 percent.

Only the services counter was up for the day (+0.84 percent) as the telecom duopoly signed a deal to lower interconnection charges. PLDT rose by 2.11 percent while Globe was up by 0.69 percent.

Value turnover for the day amounted to P5.86 billion. There were 74 advancers, which were edged out by 111 decliners, while 37 stocks were unchanged.

The PSEi was weighed down most by banking stocks Security bank and GT Capital, which both slid by more than 4 percent, while Jollibee fell by more than 3 percent.

SM Investments Corp., Metro Pacific Investments Corp. and Megaworld were all down by more than 2 percent while Metrobank, Universal Robina Corp., SM Prime, Aboitiz Equity Ventures and JG Summit fell by more than 1 percent.

Meanwhile, aside from the telecom stocks, DMCI rose by 3.3 percent while Ayala Corp. rose by 1.1 percent. Ayala Land also firmed up.

“Policy uncertainties have undoubtedly elevated the risk premium for EM (emerging market) assets. Trade frictions and a much stronger US dollar would indeed be negative for EM, but a stronger global growth in general is good for EM. Commodities firm up and asset turns improve, which drive profits up in Asia,” Citigroup said in a research note.
“Rising rates in a stronger growth environment have historically not derailed EM equity rallies. Rather, rate cuts due to weak growth have resulted in EM rolling over. We remain focused on value and higher-risk stocks and retain our large underweights in expensive and quality-centric countries, sectors and stocks,” it added.