Stocks finish positive week on cautious note as Fed, ECB drop policy hints
LOCAL SHARES dropped on Friday pulling the index back to 7,800 level with mixed signals driving the movement of stocks.
The bellwether Philippine Stock Exchange index (PSEi) lost 50.95 points or 0.64% to 7,885.90 on Friday from 7,936.85 the previous day, while the broader all-shares gauge likewise declined by 17.90 points or 0.38% to 4,735.82 at the closing bell.
The PSEi touched a high of 7,958.08 and a low of 7,875.52 in intraday session.
Investors traded 2.51 billion shares for a total value of P7.48 billion. Foreigners bought shares worth P3.688 billion and sold P4.468 billion, resulting in a net selling of P779.53 million.
Yesterday saw decliners trumped advancers, 104 to 94, while 54 stocks were unchanged.
“The Dow closed at a record for the 24th time in 2017, as gains in the financial sector helped the broader market book modest gains ahead of a roster of corporate results from the US’s biggest banks. With the perception that the economy is stronger and that a rate hike will be delayed, there was a flight to quality to less riskier asset classes,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile message on Thursday.
Mr. Limlingan also said that affecting markets was latest data from the US showing that the producer price index rose in June a touch above expectations, as higher than expected food prices and core prices excluding trade services more than offset softness in the trade services category.
Sentiment got another boost from upbeat trade data from China.
“Meanwhile, European Central Bank President Mario Draghi is scheduled to address the Federal Reserve’s Jackson Hole conference in August. The speech would come less than two weeks ahead of the ECB’s Sept. 7 policy meeting. According to WSJ, ECB officials say the bank is likely to signal at that meeting that its asset-buying program will be gradually wound down in 2018,” Mr. Limlingan further said.
At the close of trading yesterday, almost all sectoral indices ended in the red except services which was up 1.88 points or 0.11% to 1,694.51.
Property led the declines yesterday shedding 42.15 points or 1.13% to 3,687.06 followed by holding firms which lost 37.03 points or 0.47% to end at 7,880.87.
Financials shed 17.03 points or 0.86% yesterday closing at 1,956.13, while mining and oil declined 14.02 points or 0.11% to 12,729.99. The industrial counter also ended on a weak note dropping 13.94 points or 0.13% to 11,118.97 yesterday.
For Summit Securities, Inc. President Harry G. Liu, the market was just in consolidation mode.
“The market remained in consolidation phase since there was no news that can make any changes as of now,” Mr. Liu said in a telephone interview on Friday.
“Market improved for the last few days but it could not go through the resistance because there’s no driver, so we saw some correction, with no news on sight and some profit taking on the side so we just stayed in the lower support line,” he added.