Shares seen lower on profit-taking, Wall St decline

By Cecille Yap
Xinhua Financial News Service
Last updated 08:22am (Mla time) 07/10/2006

SHARE prices are expected to open lower, tracking Wall Street's retreat on Friday, as investors take profits from last week's rally, dealers said.

They added that rising tensions over North Korea's recent missile tests and higher oil prices could also weigh on sentiment.

Last Friday, the composite index ended up 30.18 points or 1.35 percent at 2,258.03. It closed the week up 3.6 percent.

The broader all-shares index gained 13.75 points to 1,403.71.

Gainers outnumbered losers 51 to 25, while 47 stocks were unchanged.

Volume turnover was 726.95 million shares worth 1.24 billion pesos.

In New York Friday, the Dow Jones industrial average closed down 134.63 points or 1.2 percent at 11,090.67, weighed down by corporate profit warnings and resurgent oil prices.

AB Capital Securities said stocks here were likely to move in a narrow range, with immediate technical support seen at the 2,200 points level.

"We have had a nice technical rebound after the market tumbled from its year-high. However volumes have been thin, indicating that investors still have concerns," AB Capital told clients in a note.

The brokerage said worries included the war of words that had followed Pyongyang's missile tests and the threat of inflationary pressure coming from a fresh spike in oil prices.

Investors will also be watching closely the Bank of Japan's policy board meeting this Thursday and Friday as it is widely expected to raise its benchmark interest rates for the first time since 2001, AB Capital said.

Rising interest rates in key markets such as the US and Japan will eventually prompt the Philippine central bank to tighten its own benchmark rates, dampening consumption and business loans demand, dealers said.

(One dollar = 52.35 pesos)

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