Stock Market - SMDC
Stock Market
BusinessWorld Online Edition
THE STOCK market closed lower for the third straight day on Friday on fresh debt worries from Spain in the Euro zone, as well as economic uncertainties in the United States, brokers and analysts said.
"The market extended its losing streak for a third consecutive day due to the uncertainties in Europe and the US," noted brokerage firm RCBC Securities, Inc. in a market report released yesterday.
Investors echoed the downbeat news abroad.
"Local share prices fell, tracking Wall Street’s sharp decline on fears that the Euro zone’s debt crisis may spread into larger economies in Europe," noted brokerage firm Wealth Securities, Inc. in a separate market report also released yesterday.
"The sell-off worsened as investors were jittered by a Fitch report that showed US banks’ exposure to contagion from European sovereign debt."
The Philippine Stock Exchange index (PSEi) dipped by 0.74% or 32.23 points, closing at 4,302.43. The broader all-share index was similarly down by 0.34% or 10.25 points to 3,013.24.
"The market was down again considering the global economic worries. US markets also closed down overnight," said analyst Elizabeth S. Abadillo of brokerage firm Angping & Associates Securities, Inc. in a text message.
Property firms dragged down the local bourse the most.
Ayala Land, Inc., the property arm of the country’s oldest conglomerate, fell by 2.60% or 44 centavos to P16.48, while mall operator SM Prime Holdings, Inc. dropped by 1.10% or 14 centavos to P12.62.
SM Development Corp., for its part, sank by 0.92% or seven centavos to P7.53 apiece.
Abroad, debt crisis concerns that similarly affected Greece and Italy in the past weeks have now reached Spain as investors noted the impending woes and took profit anew.
The Spanish government’s auction of 10-year bonds spiked to a record 7% interest rate, while debt-stricken Greece and Ireland, whose bond yields jumped to similar levels, received rescue loans from the European Union.
In the US, Democratic and Republican leaders in Congress remained locked in budget talks as solons grappled with concrete measures to cut the budget deficit to reasonable levels. This overshadowed news that unemployment claims have fallen to a seven-month low amid lower layoffs, according to data from the US Labor department.
Blue-chip Dow Jones industrial average declined by 1.1% or 134.86 points, closing at 11,770.73. The broader Standard & Poor’s 500 index dropped by 1.7% or 20.75 points to 1,216.16.
Tech-rich Nasdaq composite index fell by 2.0% or 51.62 points to 2,587.99.
At home, share turnover thinned to P4.966 billion from P6.574 billion on Thursday. Nevertheless, advancers overtook decliners, 76 to 68, while 42 stocks were unchanged.
For the first time in over a month, foreign traders succumbed to profit-taking and sold their investments as net foreign selling posted P413 million.
Most subindices declined and closed in the negative territory, led by property by 1.42% or 22.23 points to 1,538.94. Holding firms sank by 1.01% or 34.39 points to 3,367.70, while industrial shed 0.48% or 34.07 points to 7,041.13. Services and financials lost 0.36% or 5.62 points to 1,555.03 and 0.28% or 2.68 points to 957.16, respectively.
Mining and oil, however, managed to elude the market drop and closed in the green, adding 1.39% or 317.37 points to 23,176.51.
The local bourse’s performance in the coming days will still be contingent on developments abroad given no local leads and the lack of corporate earnings, which had previously lifted the market earlier this week.
"For next week, the market outlook will depend on overseas markets again, and there were no earnings or fresh news," said Ms. Abadillo.
"We might consolidate in the coming week," she said. -- Franz Jonathan G. de la Fuente
