The stock market index falls in the absence of catalysts


PHILIPPINES stocks fell on Thursday due to a lack of catalysts and as investors continue to monitor the country’s 2019 coronavirus disease (COVID-19) situation.

The Philippine Stock Exchange’s benchmark index (PSEi) fell 32.41 points or 0.46% to close at 6,886 on Thursday, while the all-stock index fell 3.70 points or 0.08% to 4,199.89.

“The market traded flat for most of the session due to the lack of catalysts,” Lance U. Soledad, junior equity analyst at AB Capital Securities, Inc. said in a Viber message.

“The market ended lower as traders sold stocks in the last minute of trading, after two consecutive days of climbing to the 6,900 level,” the Timson Securities, Inc. trader said. Darren Blaine T. Pangan in a separate Viber post.

“Investors may be assessing the COVID-19 situation and awaiting signs that the lockdown measures currently in place will be relaxed in the coming weeks,” he added.

The majority of sector indices closed in the red Thursday with the exception of industrials, which gained 25.72 points or 0.27% to 9,505.06; and financials which rose 3.26 points or 0.21% to close at 1,491.35.

Meanwhile, mining and oil fell 113.25 points or 1.21% to 9,226.95; the holding companies lost 57.11 points or 0.82% to 6,865.43; services lose 12.44 points or 0.79% to 1,561.66; and real estate lost 18.55 points or 0.54% to end at 3,393.63.

Turnover in value climbed to 6.48 billion pesos with 4.36 billion issues traded on Thursday, from 6.14 billion pesos with 4.2 billion shares traded on Wednesday.

The declines narrowly beat the advances, 100 to 97, while 52 names remained unchanged.

Net sales abroad slowed to P912.22 million Thursday against P1.44 billion recorded the day before.

Mr. Soledad of AB Capital Securities said the catalyst for Friday’s trading will be the results of the Bangko Sentral ng Pilipinas (BSP) monetary policy meeting on Thursday.

He said he expects the index to trade between 6,800 and 7,000, while Mr. Pangan of Timson Securities expects the market to end between 6,760 and 7,080.

The BSP announced after the stock market closed that its Monetary Board decided to keep the central bank’s overnight repo facility interest rate at its all-time low of 2%, as expected. Interest rates on its deposit and demand loan facilities were also maintained at 1.5% and 2.5%, respectively.

The central bank has said it is keeping borrowing costs stable amid persistent economic risks.

“Overall, the expected path of inflation and the downside risks to national economic growth justify keeping monetary policy parameters unchanged. The Monetary Council believes that sustained monetary policy support to domestic demand should help the economic recovery gain ground, especially as risk aversion continues to dampen credit activity despite the abundance of liquidity in the financial system, ”he said. – KCG Valmonte

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