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Foreign selling batters local stocks

/ 05:10 AM August 14, 2019

The local stock barometer fell sharply on Tuesday as risk-averse investors dumped local equities amid concerns that a looming crackdown on local online gaming firms would eat into the local property sector alongside a string of overseas woes.

The main-share Philippine Stock Exchange index (PSEi) shed 65.94 points or 0.84 percent to close at 7,788.45 as some P2.11 billion worth of foreign funds flowed out of local equities.

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The most battered was the property counter, which tumbled by 2.6 percent due to concerns on the Philippine offshore gaming operator (Pogo) sector, which had perked up the local office and residential property markets in the last three years.

The selldown on property stocks was a knee-jerk reaction to China’s statement against Pogos, Eagle Equities president Joseph Roxas said.

While urging the Philippine government to protect the rights and interests of Chinese citizens in the Philippines, China has also alleged that “huge” amounts of Chinese funds—estimated at hundreds of millions of yuan annually—were illegally flowing out of China into the Philippines, “involving crimes such as cross-border money laundering through underground banking.”

The day’s top three traded companies were Ayala Land, SM Prime and Megaworld, which tumbled by 2.88 percent, 2.25 percent and 5.26 percent, respectively.

Non-PSEi property stock Filinvest Land also slid by 7.18 percent.

Aside from property worries, regional concerns also dragged down the market.

“Asian equities slumped today on more bad news. Riots in Hong Kong have escalated with protesters flooding the airport, causing a major shutdown. Argentina also took a massive hit today with its currency losing 15 percent of its value and the S&P Merval Index down more than 40 percent, making it the worst one-day drop going all the way back to 1950,” AAA Securities head of research Christopher Mangun said.

“Foreign fund outflows continue to weigh heavily on our market as the world sentiment on equities gets weaker. Last-minute buying saved it from a total meltdown as the PSEi had the worst performance earlier today. As external factors continue to get worse, foreign investors may take more risk off the table and this will send our market lower,” he added.

Aside from the property sub-index, the financial and services counters also fell by more than 1 percent while the industrial counter also slipped.

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On the other hand, the holding firm and mining/oil counters slightly gained.

Value turnover for the day amounted to P8.6 billion.

There were 157 decliners that overwhelmed 53 advancers while 42 stocks were unchanged.

Aside from the property stocks, Jollibee lost another 3.38 percent. It has weakened since reporting a big decline in second-quarter profits.

BPI declined by 2.76 percent while PLDT, BDO and Metrobank all lost over 1 percent. AGI also slightly dipped.

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TAGS: Business, Local Stocks
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