Share prices fall anew on business concerns

The stock market went on a tailspin yesterday, spinning back to the 7,600 levels despite the country’s strong economic fundamentals.

Regulatory issues, the lack of catalysts and investors wary of global uncertainties all sent the stock market diving yesterday.

The benchmark Philippine Stock Exchange index (PSEi), the stock market gauge, nosedived by 128.84 points, or 1.65 percent, to settle at 7,664.40.

Likewise, the broader All-Shares index slipped to 4,539.30, down 66.67 points or 1.45 percent.

Most indexes ended in the red except for the mining and oil sector, which was the lone index to survive yesterday’s bloodbath.

Total value turnover amounted to P7 billion. Market breadth was negative, as losers outnumbered gainers 118 to 76, while 35 issues were unchanged.

Traders and market analysts were one in saying that the local bourse is a victim of negative sentiment as market investors remain jittery over President Duterte’s tirades against businesses in general.

Since last year, Duterte has been on a relentless tirade against water concessionaires Manila Water and Maynilad Water Services Inc.

Manila Water is listed in the stock market as is Maynilad’s parent firm Metro Pacific Investments Corp.

Ed Francisco, president of BDO Capital & Investment Corp., said the market has been dragged by negative sentiment.

“Our fundamentals remain good, but there are no catalysts so investors are staying on the sidelines,” Francisco said.

The regulatory issues also remain a concern for stock market investors, he said.

Duterte has criticized the 1997 water concession contracts as onerous and wants changes in these agreements. He said the government is offering new contracts which no longer contain the “onerous” provisions.

The water concessionaires and the government have yet to make a new agreement over these new contracts.

Luis Limlingan of Regina Capital said that shares slid as Moody’s released a negative sovereign credit outlook on Asia Pacific.

Chris Mangun of AAA Securities said most global equities markets ended lower ahead of the signing of the USChina trade deal as the sentiment turned slightly negative after comments from Treasury Secretary Steven Mnuchin that Washington would keep tariffs on Chinese goods until they reach a deal on the second phase of the agreement.

First Metro Investment Corp. (FMIC) chairman Francisco Sebastian said the country’s fundamentals indeed remain good, but there are so many “noise” affecting the market.

Meanwhile, Asian stocks retreated yesterday as investors awaited the signing of an initial US-China trade deal, with sentiment somewhat dented by comments from the US Treasury Secretary that tariffs would remain in place for now.

European shares were expected to follow suit, with major European stock futures trading down around 0.2-0.3 percent.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.48 percent, retreating from its 19-month peak marked on Tuesday, and Japan’s benchmark Nikkei shed 0.5 percent, off its four-week high hit the previous day.

South Korea’s KOSPI dropped 0.54 percent and China’s Shanghai Composite and Hong Kong’s Hang Seng shed 0.65 percent and 0.74 percent, respectively, while Australian stocks bucked the trend to climb 0.47 percent on the back of stronger mining shares.