The local stock barometer slipped by 1.2 percent Tuesday as jitters over US politics and a local mining shakeout curbed risk-taking among investors.
The Philippine Stock Exchange index (PSEi) lost 87.83 points to close at 7,206.84 on Valentine’s Day, tracking mostly sluggish regional markets following the resignation of US President Trump’s national security adviser Michael Flynn and ahead of a testimony by the US Federal Reserve chief before the US Congress.
“The rally (Monday) was obviously not forever. Investors fell out of love for the market in today’s trading. Developments in the US continue to rattle market sentiment not only locally but globally,” said Astro del Castillo, managing director at fund management firm First Grade Finance.
“News in our mining industry contributed to the heartache of investors. Expect the market to continue trading sideways as investors await for new developments to inspire buying,” he said.
On Tuesday, it was reported that the Department of Environment and Natural Resources (DENR) officially served notice of the cancellation of mineral production sharing agreements (MPSAs) to mining firms, some of which were owned by listed companies.
The mining/oil index thus fell by 2.67 percent while all other counters also tumbled.
“Philippine shares fell along with the rest of Asia as investors took their cue from earnings regionally and awaited more announcements from full-year 2016 results. In addition, the mining sector was the biggest loser because of the recent announcement from the DENR to cancel mineral sharing agreements,” said Luis Gerardo Limlingan, managing director at Regina Capital Development.
Limlingan noted that China’s inflation had also come in at 2.5 percent year-on-year in January, above market expectations and accelerating from December.