November 25, 2017 | MANILA, PHILIPPINES

Stocks edge lower on oil price slump, MSCI call

LOCAL EQUITIES moved within a confined range for the June 19-23 week, a period that started positively but turned out short-lived as the rest of the week saw the Philippine Stock Exchange index (PSEi) trekking south.

The PSEi finished at 7,814.17 last Friday, or lower by 0.86% compared with the level a week earlier, and by 0.68% compared with its closing four weeks earlier.

The wider all-shares index ended at 4,679.29, weaker by 0.34% compared with the earlier week and lower by 0.23% compared with its closing level four weeks ago.

“Trades were limited within 7,830-7,950,” said, the online arm of F. Yap Securities, Inc.

It said sentiment was mixed over the MSCI’s inclusion of China A shares in its emerging market index as well as crude’s retreat to $42 per barrel during the week.

Luis A. Limlingan, business development head at Regina Capital Development Corp., said local shares had been dragged down by the decline in US stocks, the slump of oil prices and the unexpected inclusion of China’s A shares into the MSCI index.

“Crude futures sank to a 10-month low amid worries of a supply glut. West Texas Intermediate was down 2% to $43.23/barrel in Nymex -- the lowest since August,” he said.

He said MSCI had announced that China’s domestic A shares would be included in the equity index, a move which he said could result in an estimated $81 billion in potential inflows to onshore equities in the coming years.

“The market was slightly lower for the week after the announcement of the 2018 MSCI A share inclusion,” Mr. Limlingan said, adding that US-listed China plays “continue to dominate investor activity.”

Sectoral indices finished mixed during the week, with holding firms taking the lead followed by mining and oil stocks. Holding firms rose 0.56% to 7,783.12 from the previous Friday. They were down by 1.53% from a month ago.

Mining and oil stocks also turned in a positive performance, although modest, as its 12,480.90 closing was higher by 0.17% compared with the earlier week, However, they were down by 0.71% compared with the level four weeks ago.

The financials index moved higher by 0.05% to finish the week at 1,927.04

Meanwhile, property led losers with a decline of 2.73% to 3,615.11. Services slipped by 1.88% to 1,714.25 and industrials by 0.06% to 11,035.94.

Last week, gainers outnumbered losers at 121 to 108, while 20 issues were unchanged. The tally was a reversal of their June 12-17 showing where 89 gained as against 133 that did not, and 24 that finished unchanged.

Foreign funds maintained their net buying of stocks, although at P94.98 million, the week’s final figure was down significantly from P13.83 billion the earlier week.