February 9, 2023

Filipino Guardian

Sentinels of Filipino Free Press

Stocks end lower on profit-taking ahead of the break

LOCAL SHARES ended last week in negative territory as investors booked gains ahead of the long weekend and data showed more ‘hot money’ exited the country in September.

The 30-component Philippine Stock Exchange Index (PSEi) fell 77.15 points, or 1.23%, to 6,153.43 on Friday, while the broader all-shares index fell 25.09 points, or 0.76%, to 3,257, 29 fell.

AB Capital Securities, Inc. vice president Jovis L. Vistan said PSEi fell as investors pocketed gains after the market’s four-day rally.

“Local stocks weakened (on Friday) as investors took profits on recent gains,” Mr Vistan said in a Viber message.

He said PSEi broke its four-day winning streak as investors sought liquidity for the long weekend.

The Philippine financial markets will be closed for public holidays from October 31st to November 1st.

“The local stock market, along with other Asian markets, fell as investors posted gains after four consecutive days of rally ahead of the long weekend,” said Claire T. Alviar, research analyst at Philstocks Financial, Inc., in a Viber message.

“Furthermore, a larger net outflow of foreign portfolio investment in September compared to the same period last year added to negative sentiment,” Ms. Alviar added.

Bangko Sentral ng Pilipinas (BSP) data released last week showed that Hot Money recorded a net outflow of $367 million in September, the largest since the country’s $374 million net outflow in April left 2021.

For the first nine months, foreign portfolio investment brought in a net inflow of $222 million, a turn from the net outflow of $495 million in the same period last year. The BSP expects hot money to bring a net inflow of $4.5 billion in 2022.

“The PSEi corrected lower on Friday after four straight days of gains in what was seen as healthy profit-taking ahead of the widely-anticipated Jumbo Fed (US Federal Reserve) rate hike in November,” said Michael L. Ricafort, Chief Economist at Rizal Commercial Banking Corp. in a Viber message.

The Fed is expected to hike rates by 75 basis points (bps) for the fourth consecutive day at its policy meeting on November 1-2. It has raised borrowing costs by 300 basis points since March so far.

At home, almost all industry indices closed lower on Friday. real estate fell 68.38 points, or 2.58%, to close at 2,572.75; Mining & Oil declined 257.51 points, or 2.56%, to 9,802.95; Holding companies fell 95.80 points, or 1.58%, to close at 5,933.37; Services fell 9.56 points, or 0.59%, to 1,592.33; and Industrials declined 32.65 points, or 0.36%, to 8,987.90.

Meanwhile, financials rose 8.66 points, or 0.54%, to close at 1,588.14.

Value turnover fell to P4.21 billion on Friday, with 421.67 million shares changing hands, from P5.64 billion with 629.95 million issues traded on Thursday.

The decliners outnumbered the climbers, 95 versus 70, while 58 names closed unchanged.

Overseas net sales on Friday were P41.54 million versus P195.71 million in net purchases recorded on Thursday. — Ashley Erika O. Jose