Local stocks continue to weaken

The local stock barometer slid on Tuesday as investors awaited a “surprise” national address scheduled by President Duterte.

The main-share Philippine Stock Exchange index (PSEi) shed 78.14 points or 1.03 percent to close at 7,518.01 as foreign funds continued to exit the market. In intraday trade, the index fell to as low as 7,492.40.

“Some investors are going on bargain-hunting as there will always be markets and companies that will do better than others amid the ongoing US-China trade war and rising inflation environment,” BDO Unibank chief strategist Jonathan Ravelas said.

Ravelas said the local market could bounce from the 7,500 support level, noting that the market was “quite oversold” and could be ripe for a technical rebound.

“Lawmakers recently approved a bill cutting corporate income tax. This will be positive for listed companies and could offer a lift. Also, it highlights government [action] to deliver much needed reforms to support the growth agenda. The market needs to move forward as the government moves to contain inflation with other non-monetary measures,” Ravelas said.

“Our present situation is like a man building a house, there are costs to manage. It will be tough. But in the end we need to keep our eyes on the prize. This is short-term pain for a long-term gain,” he added.

Meanwhile, stock investors awaited Mr. Duterte’s surprise address that was initially scheduled, aborted, then proceeded at around 3:50 pm or after the market had closed. Papa Securities noted that this was like a second State-of-the-Nation Address (SONA) for the year.

All counters fell on Tuesday, but the biggest decline was posted by the mining/oil counter, which declined by 2.2 percent.

The holding firm counter fell by 1.81 percent while the financial, industrial, services and property counters also faltered.

Value turnover for the day amounted to P5.4 billion. There was P577 million worth of net foreign selling.

There were 150 decliners that overwhelmed 58 advancers while 42 stocks were unchanged.

The PSEi was dragged down by Metro Pacific, which lost 3.74 percent, while Ayala Corp., URC and AEV all tumbled by more than 2 percent.

Metrobank, BDO and Megaworld all declined by over 1 percent. BPI, Ayala Land and Jollibee also slipped.