Shares slump as Huawei CFO’s ar­rest causes jit­ters

Business World - - The Stock Market - Arra B. Fran­cia

STOCKS tum­bled on Thurs­day as in­vestors were con­cerned the ar­rest of a top ex­ec­u­tive of Chi­nese telco giant Huawei could fur­ther flare up trade ten­sions be­tween China and the United States.

The bell­wether Philip­pine Stock Ex­change in­dex (PSEi) plunged 1.25% or 95.58 points to close at 7,535.32, af­ter trad­ing in the red for the en­tire day. The broader all­shares in­dex like­wise fell 0.94% or 43.24 points to fin­ish at 4,530.92.

“Philip­pine shares con­tin­ued the lack­lus­ter per­for­mance, us­ing the fu­tures mar­ket as a proxy for re­gional sen­ti­ment,” Regina Cap­i­tal De­vel­op­ment Corp. Man­ag­ing Di­rec­tor Luis A. Lim­lin­gan said in a mo­bile mes­sage.

Stock mar­ket fu­tures in the US mostly went down on Wed­nes­day, re­act­ing to the ar­rest of Huawei Chief Fi­nan­cial Of­fi­cer (CFO) Meng Wanzhou in Canada at the re­quest of US au­thor­i­ties for al­legedly vi­o­lat­ing US sanc­tions against Iran. This adds to the al­ready rocky foun­da­tion of the sup­posed 90-day truce agreed upon by lead­ers of both coun­tries dur­ing the G20 Sum­mit.

The Dow Jones In­dus­trial Av­er­age fu­tures dropped 1.3% or 332 points, while the S&P 500 fu­tures slipped 1.3% or 34.20 points.

US mar­kets were closed on Wed­nes­day in ob­ser­vance of a na­tional day of mourn­ing fol­low­ing the death of for­mer Pres­i­dent Ge­orge H.W. Bush last Nov. 30.

Asian in­dices also fol­lowed US mar­ket fu­tures, clos­ing mostly in neg­a­tive ter­ri­tory on Thurs­day.

The blood­bath ex­tended to all sec­tors back home, led by the prop­erty sub-in­dex which dropped 1.95% or 73.10 points to 3,672.33.

Hold­ing firms shed 1.35% or 101.91 points to 7,443.35; ser­vices slipped 0.91% or 13.15 points to 1,424.27; min­ing and oil went down 0.59% or 51.41 points to 8,554.64; in­dus­tri­als dipped 0.59% or 64.73 points to 10,842.51; while fi­nan­cials lost 0.42% or 7.67 points to 1,790.40.

Some 4.61 bil­lion is­sues switched hands re­sult­ing in a turnover of P7.19 bil­lion, down from Wed­nes­day’s P8.32 bil­lion.

De­clin­ers out­paced ad­vancers, 113 to 74, while 50 names were un­changed.

For­eign in­vestors turned buy­ers, record­ing net in­flows of P128.34 mil­lion com­pared to the pre­vi­ous ses­sion’s net sales worth P28 mil­lion.

Among the day’s top gain­ers was First Gen Corp. (FGEN), which ral­lied 4.81% to P19.18 each.

“This is the sec­ond day straight that FGEN has bucked the trend and stayed the top gainer. Its part­ner­ship with Tokyo Gas in pur­suit of build­ing an LNG ter­mi­nal ap­pears to have been the cat­a­lyst as this should en­sure its abil­ity to main­tain a sta­ble fuel source upon Malampaya’s de­ple­tion,” Papa Se­cu­ri­ties Corp. Head of On­line Trad­ing Ar­bee B. Lu said in an e-mail.

“De­spite to­day and yes­ter­day’s de­clines, the PSEi is still trad­ing well within its up­trend chan­nel and has room to cor­rect with­out break­ing down un­til 7,381 — that’s still -2.0% away. We con­tinue to view this as an op­por­tu­nity to re­cal­i­brate hold­ings in prepa­ra­tion for the next up­swing,” Ms. Lu said on Thurs­day.

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