PSE index halts six-day slump on selective buying

THE MAIN INDEX snapped its six-day losing streak on Thursday as investors went on selective buying of stocks with good valuations.

The benchmark Philippine Stock Exchange index (PSEi) bounced back 0.91% or 68.17 points to close at 7,517.37 yesterday. The broader all-shares index likewise gained 0.54% or 25.15 points to 4,602.31.

“There’s a support at the 7,450 level for now, propped up by some entries into attractive valuations as we look forward to positive 2019 earnings,” DA Market Securities, Inc. Chief Equity Strategist Nisha S. Alicer said via text on Thursday.

“However, there’s a cautious tone to the market due to possible headwinds to market’s recent gains such as weak peso, potential damage of super typhoon, impact on inflation, BSP (Bangko Sentral ng Pilipinas) rate hike estimate of 50 bps to 4.50% late September. Foreign selling has also continued,” Ms. Alicer added.

Foreign investors were net sellers for the 11th consecutive day, recording net outflows of P398.03 million, albeit slimming down from the previous session’s P886.62 million.

Meanwhile, Diversified Securities, Inc. trader Aniceto K. Pangan said the PSEi moved in sync with regional markets.

“Local market rebounded today on oversold level as regional markets recovered on prospect of fresh trade war negotiations between United States and China with US Treasury Secretary Steve Mnuchin who recently reached out to Beijing to propose another round of talks,” Mr. Pangan said in a separate message on Thursday.

Reports noted that the new round of trade talks may take place in Washington, following the Chinese government’s pronouncements earlier this week that it will bring up its spat with the US to the World Trade Organization on Sept. 21.

On the other hand, Wall Street indices ended mixed despite flattish performances, with the Dow Jones Industrial Average adding 0.11% or 27.86 points to 25,998.92, and the S&P 500 index gaining 0.04% or 1.03 points to 2,888.92. In contrast, the Nasdaq Composite index lost 0.23% or 18.24 points to 7,954.23.

Back home, all sectoral indices closed in the green, led by the mining and oil counter with an increase of 1.96% or 188.63 points to 9,773.62, followed by property which firmed up 1.2% or 44.89 points to 3,767.51.

Industrials jumped 0.83% or 92.07 points to 11,123.30; services went up 0.8% or 12.23 points to 1,527.16; holding firms added 0.56% or 40.96 points to 7,355.26; while financials rose 0.48% or 8.06 points to 1,676.90.

Some 738.47 million issues switched hands valued at P6.07 billion, climbing from the previous session’s P5.67 billion.

Decliners outpaced advancers, 123 to 72, while 45 stocks remained unchanged.

“Should we test lower, minor supports are at 7,300/7,200, major is at 7,000/6,923 which is the June 22 low,” Ms. Alicer said.