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Business

Market wipes out 2013 gains

Neil Jerome C. Morales - The Philippine Star

MANILA, Philippines - Gloomy sentiments brought about by anxiety over the US Fed’s tapering dominated the local stock market, setting up what could be the first yearly loss of the bellwether index since 2008.

The Philippine Stock Exchange index plunged 2.14 percent or 126.21 points to wipe out gains for the year and close at a fresh three-month low of 5,762.53. It was only the third time this year that the main index closed below the end-2012 level of 5,812.73.

With just a few days before the trading year ends, the decline opened the possibility that the benchmark index will incur a yearly loss for the first time since the height of the global financial crisis in 2008.

“Since we broke the 6,000 level psychological support, negative sentiments persisted,” Freya B. Natividad, investment analyst at Papa Securities Corp., said in a phone interview.

“Negative sentiments have been dominating the market in the past few days,” she added.

Jonathan Ravelas, chief market strategist of BDO Unibank Inc., said the market succumbed to profit taking due to expectations of an imminent easing of the US Fed’s stimulus program that will reduce liquidity in financial markets.

Natividad said the slew of confidence-dampening leads like the economic impact of Super Typhoon Yolanda and the tighter monetary policy in the US resulted in portfolio repositioning.

Global and regional markets also slipped on concerns that the US Federal Reserve will cut back its bond buying program next week.

The Dow Jones Industrial average eased 0.81 percent or 129.60 points to 15,843.53 while the broader Standard & Poor’s 500 index lost 1.13 percent or 20.40 points to 1,782.22.

For Asian stocks, Japan’s Nikkei 225 retreated 1.12 percent or 173.24 points to 15,341.82 while Hong Kong’s Hang Seng index dropped 0.47 percent or 109.62 points to 23,228.62.

At home, all counters were in the red, paced by holding firms that plunged 2.64 percent or 143.39 points to 5,282.98.

Turnover value hit P9.41 billion, down from P78.48 billion on Wednesday that was boosted by the P72-billion JG Summit’s purchase of a 27-percent in Manila Electric Co. from San Miguel Corp.

Decliners dominated advancers, 120 to 36, while 36 stocks did not change.

Most active stocks were in the negative territory, led by top traded Metrobank (-1.94 percent), PLDT (-1.94 percent) and ICTSI (-0.99 percent).

Natividad said local stocks might post a technical correction in the next few days.

Ravelas said the main index might bounce after it tests the 5,500-5,700 levels.

 

 

 

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DOW JONES INDUSTRIAL

FEDERAL RESERVE

FOR ASIAN

FREYA B

HANG SENG

HONG KONG

INDEX

JONATHAN RAVELAS

NATIVIDAD

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