PLDT, political concerns push index to 7-week low

Share prices tumbled to their lowest levels in nearly seven weeks after a disappointing profit announcement by telecoms company PLDT and continuing legal challenges to President Gloria Arroyo’s government, analysts said.

The Philippine Stock Exchange composite index fell 43.29 points to 1,570. 20 points.

"I think the market took its cue from PLDT. Most people are taking the PLDT earnings negatively," said Enrique Santa Ana, associate director at Vickers Ballas Securities Philippines Inc.

"Of course, there’s the confusion over the legitimacy of the Arroyo government," Santa Ana added.

Deposed president Joseph Estrada has a petition pending before the Supreme Court questioning the legitimacy of his successor, Gloria Arroyo, who took power.

"The market is restless and is trying to look for new positive developments. Investors also remain wary over the current political situation with the Supreme Court to come out with its decision (on Arroyo) by March 13," said Roberto Cano of BPI Securities Inc.

PLDT fell P35 to P760 while SM Prime Holdings dropped 40 centavos to P6.70.

Ayala Land Inc. lost 10 centavos to P6.30.

Manila Electric Co. A shares fell P1 to P53 while its B shares fell by 50 centavos to P61.

Analysts said the market’s movement is still largely weighed down by the pending Supreme Court case on the legitimacy of the Macapagal-Arroyo administration and the staunch vow of deposed president Joseph Estrada to return to power.

The Estrada government was booted out of Malacañang following a popular uprising at the historic EDSA Shrine last January 20, paving the way for Arroyo’s proclamation that same day. Estrada, however, contested that he was only on leave and that Arroyo is serving on an acting capacity.

When stocks resumed their trading on Jan. 22, prices surged at a record rate, zooming higher by 17.56 percent or 255.13 points to close at 1,708.06.

But as euphoria over the change in government subsided, stock trading went back to its listless ways as investors began to voice concerns on the SC case as well as the country’s economic fundamentals.

The remarks of US Federal Reserve chairman Alan Greenspan that there was no immediate need for further rate cuts likewise dampened trading as the US and most Asian markets reacted on the downside, with the technology-laden Nasdaq plunging to a fresh year-low and the Tokyo bourse dropping to its lowest mark in 15 years.

The number of declining issues swamped gainers, 72 to 12, with 34 stocks unchanged on a lean total turnover of P735.31 million.