PSEi tumbles by 1.46%
The main-share Philippine Stock Exchange index tumbled by 83.26 points, or 1.46 percent, to close at 5,623.85. All counters ended lower but the hardest hit were the financial (-2.11 percent) and property (-1.67 percent) counters.
“I think this is a tactical move as some major foreign brokers are recommending an increase in allotment to China and North Asia given the cheap valuations in these markets,” said Paul Joseph Garcia, a fund manager and head of Odyssey Funds at Bank of the Philippine Islands.
He said the price-to-earnings ratio in China was about 10 times earnings, compared to the Philippine multiple of 16 times going into next year.
A P/E ratio of 16 means investors are paying 16 times the amount of money that the Philippine market is expected to make in 2013. “So we might see more profit-taking from foreign funds,” he said.
Value turnover amounted to P9.4 billion. There were twice as many decliners as there were advancers, as investors took advantage of lofty valuations to pocket gains.
The biggest index decliners were RLC (-4.68 percent), SMC (-4.63 percent), SMIC (-3.32 percent), Jollibee (-2.89 percent), BPI (-2.8 percent), BDO (-2.74 percent), SM Prime (-2.63 percent), Metrobank (-2.19 percent), JG Summit (-2.19 percent) and URC (-1.41 percent).
Investors likewise sold down PLDT, SM Prime, AGI, AP, Globe Telecom, ALI, EDC and Megaworld.
Elsewhere in the region, stock markets were mostly lower due to concerns on the US fiscal woes.