Philippine stocks stumble further

• Source: Xinhua
• [08:51 July 10 2009]
• Comments

The Philippine market has another boring trading on Thursday as investors found no incentive to aggressively enter the market on lack of leads.

 The bellwether Philippine Stock Exchange index rallied by 0.48 percent or 11.86 points to 2,473.65, while the all share index rose by 0.67 percent or 10.58 points to 1,589.35.

Trading remains anemic with only 827 million shares valued at 2. 2 billion pesos (45.49 million US dollars) were exchanged. Foreign investors continue to be net sellers at 376 million pesos (7.77 million US dollars).

Two of the six subsector indices continue to bleed. Mining and oil shares tumbled by 0.81 percent or 48.35 points to 5,874.18, while service stocks lost 0.42 percent or 5.55 points to 1,307.11.

Industrial shares, where Philippines' largest power distributor Manila Electric Co. (Meralco) belongs, rallied by 1.63 percent or 57.68 points to 3,595.09.

 More stocks gained than lost 60 to 34 while 55 shares were unchanged.

Claire Quiray of Analyst-Traders Equities Training Center said investors are speculating on the second quarter earning prospects of some of the companies. These select issues are the only factors that have been driving up the composite index.

"Right now, the market is directionless. So what will investors touch other than those large caps that are still making money despite the economic slowdown," Quiray said in an interview.

Quiray said the market remains directionless because investors are still confused whether to buy or sell their shares. She pointed out that only those who are liquid enough are the ones who are slowly positioning themselves while a larger number of investors are adopting a wait-and-see stance until they see a firmer direction of the market.

Quiray said the US market also closed flat on Wednesday night, proving little incentive to investors. The market was already closed also when the Philippine central bank announced its plan to cut interest rates.

"Investors are waiting for more economic indicators from the United States. Whatever will be released will trickle down on the country and this will move the market. Also, most of our big investors who are fueling the equities are the foreign investors who remain at the selling mode," She said.

Quiray said there are also some investors who believe that the market will have another one big drop before rallying again. These investors are waiting for that drop before they enter the market.

Stocks in the 30-company index ended mixed.