PSE index ends lower as virus clouds sentiment

By Denise A. Valdez, Reporter

THE MAIN INDEX closed lower yesterday as uncertainties over the coronavirus disease 2019 (COVID-19) pandemic continued to cloud investor sentiment globally.

The Philippine Stock Exchange (PSEi) shed 56.32 points or 0.97% to 5,733.65 on Monday. The broader all shares index likewise gave up 18.53 points or 0.53% to 3,473.90.

“Local shares started lower as investors remained vigilant on news of a possible treatment for COVID-19 and after the Trump administration announced guidelines for reopening the economy,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile message.

Different countries across the world are trying possible treatments or antiviral medicine for COVID-19, and last week, United States-based Gilead Sciences, Inc. was reported to have found favorable results from its trials.

This resulted in hopes that the end of the pandemic is coming soon, on top of the United States government’s release of guidelines for a three-phased reopening of its economy.

Philstocks Financial, Inc. Research Associate Piper Chaucer E. Tan said the lack of foreign money in the Philippine market shows the instability of the PSEI’s climb as observed in the past four weeks.

“The market performance ending on red territory is within our expectation that the 5,800 resistance will be tested by investors… We expect also that the recent market rally may not be sustainable if you would take a look at its foreign fund flow,” he said.

Net foreign selling stood at P628.75 million yesterday, marking the 24^th straight day that foreigners have pulled their money out of the local bourse.

“It is crucial for the market to have the presence of foreign funds in order to maintain and sustain the market rally,” Mr. Tan said. “With the threats of the number of coronavirus infections in Southeast Asia…, (there are) mounting worries among experts that the region could turn into a hotspot for the fast-spreading disease.”

The industrials index lost 121.15 points or 1.60% to 7,445.67 yesterday. Financials shed 13.16 points or 1.06% to 1,222.56; property trimmed 31.52 points or 1.06% to 2,932.17; and holding firms shaved off 45.66 points or 0.79% to 5,686.06.

But some indices still closed with gains: mining and oil by 92.88 points or 1.98% to 4,781.10; and services by 4.39 points or 0.33% to 1,299.23.

Value turnover dropped to P4.76 billion yesterday from P7.29 billion in the previous session. Volume also slid to 703.70 million from 733.29 million on Monday.

Advancers outnumbered decliners, 109 against 83. Some 44 names ended unchanged.

“We expect more volatility in the upcoming weeks as to uncertainty of the enhanced community quarantine, whether it will be extended again or (will be partially lifted) to restart the economy,” Mr. Tan said.