Index eases as market continues to consolidate

MANILA, Philippines - The local stock market succumbed to profit taking yesterday, snapping a three-day gain in the main index.

With the end of the impeachment trial, the Aquino administration can now focus more on economic reforms required by investors, analysts said.

The Philippine Stock Exchange (PSE) index dropped 0.1 percent or 4.79 points to 5,018.32, while the broader all shares index slipped 0.1 percent or 3.43 points to 3,348.73.

Prior to the decline, the bellwether index climbed for three straight days to reach the 5,000 mark since closing at 5,017.02 on May 17.

“Basically we expected positive responses to Moody’s credit outlook upgrade... [but] this market seized on the latest rally to take profits,” Grace Cerdenia, analyst at brokerage firm 2Trade-Asia.com, said in a phone interview.

“There is no specific reason for the decline today. There is no sentiment to push the market,” said Jose Mari B. Lacson, head of research at stock brokerage Campos, Lanuza & Co.

“We are still in consolidation,” Lacson added.

On Tuesday, New York-based Moody’s Investor Service affirmed the Ba2 rating – two notches below investment grade – for the Philippines’ long-term foreign-currency and local-currency debts but upgraded the outlook to positive from stable.

Most subindices were in the red, led by mining and oil that declined 1.96 percent or 471.03 points to 23,598.69.

Service firms bucked the trend, rising 0.78 percent or 12.36 points to 1,598.62 while industrial companies added 0.57 percent or 44.27 to 7,787.25.

Turnover climbed to P6.6 billion yesterday from P5.25 billion on Tuesday.

The local market bucked the trend in the US, whose markets climbed due to hopes that China can stimulate its economic growth and that Greece can avert an exit from the euro zone.