PSE index extends gains as Xi starts visit to PHL

THE MAIN INDEX extended its gains on Tuesday, as investors focused on Chinese President Xi Jinping’s visit to the country.

The 30-member Philippine Stock Exchange index (PSEi) rose 0.45% or 32.68 points to close at 7,302.94 yesterday, marking its fifth day in positive territory. The broader all-shares index also firmed up 0.26% or 11.52 points to 4,398.34.

“The main index saw a pullback in the morning session but was quickly turned around by the positivity of investors... Foreign funds snapped eight days of outflows with net-buying today at P526 million. This is a very good sign,” Eagle Equities, Inc. Research Head Christopher John Mangun said in an e-mail on Tuesday.

Foreign investors turned buyers for the first time in eight sessions, recording net purchases worth P526.01 million yesterday versus net foreign outflows of P286.49 million on Monday.

Papa Securities Corp. trader Gabriel Jose F. Perez also attributed the uptick to the return of foreign funds to the local market, adding that “there was also strength behind [Tuesday’s] recovery given the substantial value turnover of P6.9 billion.”

The reentry of foreign funds into the market came amid Mr. Xi’s arrival in the Philippines on Tuesday morning, where he is set to sign agreements with President Rodrigo R. Duterte. The government is looking a signing investment deals for major infrastructure projects in the country, as promised during Mr. Duterte’s Beijing visit two years ago.

The PSEi shrugged off the weakness in US markets, as tech stocks dragged major indices lower. The Dow Jones Industrial Average plunged 1.56% or 395.78 points to 25,017.44. The S&P 500 index slipped 1.66% or 45.54 points to 2,690.73, while the Nasdaq Composite index fell 3.03% or 219.40 points to 7,028.48.

Most Asian markets also ended lower, reflecting the negativity in Wall Street.

Back home, sectoral indices were equally split between advancers and decliners. The property counter led advancers with a 0.97% or 33.79 points increase to 3,511.93. Holding firms went up 0.73% or 52.70 points to 7,224.97, while financials added 0.55% or 9.51 points to 1,710.83.

Meanwhile, mining and oil dropped 2.8% or 250.28 points to close at 8,679.64. Services shed 0.92% or 13.05 points to 1,402.84, and industrials slumped 0.62% or 66.62 points to 10,637.11.

Turnover slimmed to P6.92 billion after some 949.31 million issues switched hands, from P8.34 billion in the previous session.

Decliners beat advancers, 109 to 84, while 47 names ended flat.

“Continue to watch out for how US markets move [on Tuesday night] especially with how the PSEi tends to have a knee-jerk reaction…,” Papa Securities’ Mr. Perez said.

Eagle Equities’ Mr. Mangun placed the next resistance at 7,350, with immediate support steady at 7,200.