Main index rebounds as investors buy bargains

LOCAL SHARES staged a lastminute rebound on Tuesday, jumping back to the 7,000 level as investors looked for bargains.

The 30- member Philippine Stock Exchange index ( PSEi) snapped a nine-day losing streak yesterday, firming up 0.29% or 20.33 points to 7,007.21.

In contrast, the broader allshares index dipped 0.04% or 2.10 points to 4,309.31.

“Philippine investors turned into bargain hunters... The market seems more likely to see more pressure as more exchange on US- China Trade Tension feedback and more western corporates commented to be impacted with trade tariffs globally,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile message.

Foreign investors were net buyers for the first time in 27 days, recording a small net inflow of P57.67 million, compared to the previous session’s net sales amounting to P401.53 million.

“The index ended with a hammer candlestick pattern, which typically indicates that a bullish reversal may be afoot. On a similarly positive note, foreign investors were net buyers today, although the amount was rather modest at P58 million,” Papa Securities Corp. analyst Arbee B. Lu said in an e-mail.

Despite the uptick, analysts noted that the PSEi may not be seeing a trend reversal just yet.

“If we are indeed in for a bounce, expect it to be short-lived as the PSEi has yet to reach its support at 6,600,” Ms. Lu said.

Wall Street indices suffered huge drops overnight, after one of United States President Donald J. Trump’s top advisers said the market was “overreacting,” noting that investment restrictions against China and other countries will not be immediate.

Analysts have also expressed fears on the slowing down of the global economic growth due to the trade spat with China.

The Dow Jones Industrial Average dumped 1.33% or 328.09 points to 24,252.80. The S&P 500 index shed 1.37% or 37.81 points to 2,717.07, while the Nasdaq Composite index gave up 2.09% or 160.81 points to 7,532.01.

Meanwhile, Asian markets ended mixed, with Chinese indices leading the losses due to prevailing fears on the trade war.

Back home, sectoral indices were split between gainers and losers. The mining and oil counter led decliners with a loss of 1.95% or 190.83 points to 9,556.57. Financials dropped 1.06% or 18.89 points to 1,750.67, while services gave up 0.41% or 5.65 points to 1,371.63.

Meanwhile, holding firms gained 0.75% or 51.37 points to 6,873.07, followed by property which picked up 0.50% or 17.01 points to 3,406.75. Industrials climbed 0.34% or 35.35 points to 10,352.28.

Some 707.56 million issues switched hands, resulting in a value turnover of P5.92 billion, down from Monday’s P6.12 billion.

Decliners outpaced advancers, 127 to 78, while 41 issues were unchanged.