Stocks close lower as investors pocket profits

Philippine shares closed in the red again on Monday due to selling pressure amid corruption concerns and as investors pocketed their profits.

The Philippine Stock Exchange index (PSEi) declined by 0.76% or 47.27 points to end at 6,101.86, while the broader all shares index decreased by 0.26% or 9.93 points to 3,682.78.

“The local market dropped on the first trading day of the week as investors took profits following a two-day rally,” Philstocks Financial Inc. Research Manager Japhet Louis O. Tantiangco said in a report. “Investors also digested the latest developments in the corruption issues of the Philippines’ flood control projects.”

“The index started the week in the red as sellers dominated today’s market… Concerns over the current flood control issues may also be weighing on market sentiment,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

The Philippine Senate on Monday continued its inquiry into alleged corruption in government flood control projects, with the contractors said to be involved in these initiatives naming some lawmakers, local government and Public Works department officials who they claimed received kickbacks.

Mr. Limlingan added that investors chose to stay on the sidelines before the release of August US consumer and producer inflation data this week, as these could affect the US Federal Reserve’s decision in its Sept. 16-17 meeting, especially after US labor reports released last week bolstered the case for a cut at the review.

“US equities eased last Friday after a record-setting run as investors paused to reassess momentum following softer labor data. Despite the mild pullback, sentiment remains constructive with optimism still present heading into the new week,” he said.

The majority of sectoral indices closed lower on Monday. Financials fell by 1.27% or 26.22 points to 2,023.79; holding firms decreased by 1.25% or 64.37 points to 5,049.51; services went down by 1% or 22.06 points to 2,182.23; and property retreated by 0.07% or 1.85 points to 2,459.66.

Meanwhile, industrials increased by 0.94% or 85.12 points to 9,082.22, and mining and oil climbed by 0.78% or 86.55 points to 11,149.39.

Value turnover declined to P5.72 billion on Monday with 2.7 billion shares traded from the PHP 5.97 billion with 2.27 billion shares that changed hands on Friday.

“Semirara Mining and Power Corp. was the day’s index leader, climbing 5.29% to PHP 34.85. DigiPlus Interactive Corp. was the main index laggard, falling 7.78% to PHP 19.92,” Mr. Tantiangco said.

Market breadth was negative as decliners outnumbered advancers, 107 to 87, while 52 names closed unchanged.

Net foreign selling was at PHP 340.8 million on Monday versus the PHP 100.42 million in net buying recorded on Friday. — Alexandria Grace C. Magno