PSEi drops on cautiousness over US-China tensions

By Denise A. Valdez, Reporter

THE MAIN INDEX ended lower on Wednesday as general investor sentiment remained cautious over the brewing Sino-US tensions.

The benchmark Philippine Stock Exchange index (PSEi) trimmed 32.40 points or 0.57% to close at 5,639.27. The broader all shares index also fell 8.93 points or 0.26% to 3,416.05.

“The market closed lower despite opening on green territory. This is due to the lingering uncertainty over the China-US tensions as President Trump releases statements about China being the source of the pandemic,” Timson Securities, Inc. Trader Darren T. Pangan said in a text message.

As US President Donald Trump remained stern in blaming China for a cover-up of the coronavirus disease 2019 (COVID-19) crisis which blew up into a global outbreak, experts from both countries have raised concerns on the new “cold war” between the two countries.

China’s Ambassador to US Cui Tiankai has called for a truce in the “blame game,” saying in a column in US newspaper Washington Post that China and US should instead “focus on the disease and rebuild trust between out two countries.”

With the China-US story still unfolding, investors chose to stay on the sidelines of trading yesterday, AAA Southeast Equities, Inc. Research Head Christopher John Mangun said.

“Investors were mainly cautious as they awaited a reaction from the Chinese government on accusations from top US officials that the COVID-19 virus originated in a Wuhan lab, he said in an e-mail. “Here at the PSE, the main index ended slightly lower on average trading volumes.”

The PSEi opened at 5,689.78 and reached a low of 5,594.81 before settling at 5,639.27 at the close. Mr. Pangan said profit takers have hounded the market after local shares expanded the previous session following President Rodrigo R. Duterte’s apology to businessmen Zobels and Manuel V. Pangilinan.

Five of six sectoral indices closed in red territory on Wednesday. Mining and oil fell 55.04 points or 1.19% to 4,570.53; industrials shaved off 73.18 points or 0.98% to 7,380.82; financials lost 9.85 points or 0.84% to 1,157.64; holding firms shed 41.62 points or 0.74% to 5,519.23; and services dropped 3.15 points or 0.23% to 1,347.33.

The sole gainer was property, which went up 7.02 points or 0.24% to close at 2,919.94.

Some 561.48 million issues valued at P6.05 billion switched hands yesterday, lower from Tuesday’s 619.49 million issues worth P6.43 billion.

Decliners outnumbered advancers, 126 against 69, while 36 names ended unchanged.

Overseas investors returned to selling on Wednesday, with the local market recording net foreign selling of P969.47 million from Tuesday’s net inflows of P86.52 million.

“PSEi’s losses today are seen as a slight pull back which keeps the trend healthy. We may see it continue higher toward the end of the week,” Mr. Mangun said on Wednesday.