Philippine stocks drop on weak leads

MANILA, Philippines—(UPDATE) Share prices on Monday succumbed to profit-taking as inflation concerns affected economic growth prospects.

The main-share Philippine Stock Exchange index shed 38.72 points, or 0.9 percent, to finish at 4,258.90, declining for the second straight session.

The holding firms and mining/oil counters were the most affected, declining by 1.14 percent and 1.35 percent, respectively.

Value turnover was thin at P2.93 billion. There was meager net foreign buying of P8 million for the day.

There were 51 advancers against 80 decliners, while 47 stocks were unchanged.

“Locally, there is no strong factor that seems to be favorable enough to lead the PSEi firmly higher. While economic data is highly monitored, there is no lasting and drastic effect to the market and to the investors’ sentiments,” said AB Capital Securities analyst Maria Arlysa Narciso.

PLDT, Lepanto “A” (open only to local investors), AGI, Metrobank, Aboitiz Power, Metro Pacific, Banco de Oro, EDC, Lepanto “B” (open to both local and foreign investors), BPI, First Gen, Jollibee and Meralco dragged down the index.

Investors also pocketed gains from San Miguel Corp., a strong performer last week.

Other non-index stocks Cebu Air, Leisure & Resorts and Atlas Mining also fell.

Among the few stocks that bucked the downturn were Empire East Land, Philex Mining and ISM Communications.

It was announced last week that Empire East would be consolidated into the books of parent firm Megaworld.

In AB Capital’s weekly report, Narciso said the gentle tug of the foreign markets was still expected to be felt this week especially with the debt worries and economic recovery efforts of major countries.

“The divergence in the PSEi’s technical indicators only proves that the market lacks conviction to move on either direction and, instead, will keep its sideways trend. The range of 4,200 to 4,340 is also the support and resistance levels of the index.”—Doris C. Dumlao