Philippine stocks end lower, market confidence remains

The Philippine market lost 0.53 percent of its value on Monday but investors' confidence over the long-term prospect of the market remains intact.

The bellwether Philippine Stock Exchange index managed to recover some of the 30-point loss it made during the intra-day session to settle at 3,424.29 or just 18.39 points lower than Friday's close. The broader all-share index was also down by 9.24 points to 2,167.79, although three of the six subsector indices, namely the financial, holding firm and mining and oil sectors, closed higher.

A total of 1.14 billion shares were traded, valued at 2.38 billion pesos (51.41 million U.S. dollars). Foreign investors were net sellers with 80.52 million pesos (1.73 million U.S. dollars).

"The Philippine market continues to experience a small correction but support for the 3,400 level is obviously present," Elizabeth Abadillo, analyst of Angping and Associates Securities, Inc., said in an interview.

"The low trading volume suggested that while there were profit takers, there were no aggressive sellers in the market. It seems as if investors are waiting for something to happen," Abadillo said.

Market participants are waiting for Philippine President Benigno Aquino III's first state of the nation address (SONA) which will be delivered next week. Aquino is expected to present his more detailed economic agenda in Monday's SONA.

Abadillo said investors are optimistic of Aquino's presidency. Investors, she said, are closely monitoring the first 100 days of the new president and "so far his moves are favorable."

"The 3,400 level looks sustainable. The country's macroeconomic fundamentals are positive," Abadillo said.

But over the next sessions, Abadillo said she expects investors to continue profit taking albeit minimally in the absence of any local and overseas developments and given the market's high level.

The sharp decline in U.S. equities Friday, on reports of weak consumer confidence and lower-than-expected corporate results, also weighed in local stocks.

The Philippine index fell by as much as 30 points during mid- trading after some investors opted to book their gains before trimming down some of its losses at the final bell.

While the 261-point slide in the US market failed to significantly push down the Philippine market on Monday, Justino Calaycay of Accord Capital Equities Corp. said this will "raise the bar of pessimism."

"Concern over the pace of global recovery resurfaced after disappointing economic data from the U.S. Retail sales and Producer Price Index fell more than anticipated," he said.

Source: Xinhua