PSEi falls below 7,700

THE LOCAL stock barometer slipped on profit-taking for the second session in a row on Wednesday, falling below the 7,700 level.

The Philippine Stock Exchange index lost 36.71 points or 0.48 percent to close at 7,686.43. Across the region, trading sentiment was mixed amid jitters on the debt crisis in Greece. The market closed near the day’s low after hitting an intra-day peak of 7,758.46.

It was the last trading day before the first monetary setting of the Bangko Sentral ng Pilipinas for 2015 on Feb. 12, during which monetary authorities are expected to keep key interest rates steady.

The main index was weighed down by the financial, industrial, holding firm and services counters while the mining/oil and property counters firmed up.
Dealers said investors were pocketing gains after the surge of the main index to record-highs recently.

Value turnover for the day amounted to P9.55 billion. There were 88 advancers which were edged out by 97 decliners while 42 stocks were unchanged.

The PSEi was led lower by Petron which slumped by 4 percent. URC, Metrobank and LTG all slipped by over 2 percent. SMIC, ICTSI, DMCI and FGEN fell by over 1 percent.

PLDT, Bloomberry and AGI also contributed to the decline.

Outside of the PSEi, shares of Cebu Air also fell by 2.92 percent.

On the other hand, MPI and JG Summit gained by over 1 percent. SM Prime, GTCAP, ALI, EDC, BPI and AC also firmed up.

DA Market Securities said in a research note on Wednesday that the market was susceptible to profit-taking going further into the corporate earnings season and nearer to the Chinese New Year celebrations in the region, which the brokerage said may trigger a period of low-volume trading due to extended holidays.

“We also note possible rife rotation of fund flows among stocks as investors seek for more attractive values in the market,” it said.

Based on relative strength indicators, DA Market said the market was at “overbought” territory. Moving average convergence-divergence continues to show a bullish crossover but is at an elevated level which can lead to a bearish crossover, it added.

Overall, DA Market said 2015 was anticipated to be a year volatility, a period thus seen suitable to a more nimble investor with a short to medium-term investment horizon.

“Market swings may stem particularly from external factors including possible tightening in the US (interest rate hike by mid-year) and concerns about deflation in the eurozone and economic slowdown in China. On the local front, we may see election-related news to become more market relevant as we enter the thick of the campaign season and monitor poll results,” it said.