PSEi slips below 7,200

A normal, busy day at the Philippine Stock Exchange. INQUIRER file photo

THE LOCAL stock barometer slipped to the 7,100 level on Thursday as investors braced for a potential interest rate hike by the US Federal Reserve (Fed) next month.

Declining for the second straight session, the Philippine Stock Exchange index shed 78.57 points or 1.09 percent to close at 7,122.45. Elsewhere in the region, trading sentiment was mixed especially as China’s stock market heads to bull territory, bouncing from the meltown seen in recent months.

As US Fed chair Janet Yellen confirmed that the lift-off is a “live possibility” at the Federal Open Market Committee (FOMC) meeting in December, Citigroup noted in a research note that the US dollar had strengthened against every major G10 and emerging market currency.

“With six weeks still to go to the December FOMC, we question whether markets are likely to price in more aggressive probability for Fed liftoff, or if instead expectations may be nearing a peak,” Citigroup said.

At the local market, the decline was led by services which fell by 2.72 percent while holding firms and property counters tumbled by over 1 percent.

Value turnover for the day amounted to P6.52 billion. There were 124 decliners which overwhelmed 48 advancers while 44 stocks were unchanged.

Gaming operator Bloomberry slid by 6.77 percent. BPI Securities said the higher-than-expected third quarter results were due to “unsustainably high win rates.”

A casino’s “win” rate is based on the element of luck but is also affected by the spread of table limits, a player’s skill and resources and amount of time spent in the casino. A high win rate meant that the “house” won more as a ratio of total bets.

PLDT, Megaworld and SM Prime all faltered by over 3 percent. SMIC fell by 2 percent while BDO, ICTSI and Globe tumbled by over 1 percent.

URC, ALI, AC, Metrobank, RLC, Meralco and AEV all declined.

Outside of the PSEi, DNL fell by 2.87 percent and VLL slumped by 1.03 percent in heavy volume.

Among those that bucked the downturn was BPI which rose by 1.81 percent and was the most actively traded stock ahead of the release of its third quarter corporate earnings. GTCAP fell by 0.22 percent.

Non-PSEi stock Liberty surged by 13.23 percent as investors speculated on a partnership between parent SMC and Australia’s Telstra group on the telecommunication business. The two groups have admitted talking about a joint venture but have yet to strike any deal.