Index retreats 112 pts on Wall St losses, profit taking

The Philippine Star 01/27/2007

 

Share prices closed sharply lower yesterday, falling 3.43 percent lower as losses on Wall Street sparked a regional sell-off and with investors opting to take profits after a week-long rally, dealers said.

However, they said the market’s sharp downturn had been expected as many stocks had become expensive.

The composite index fell 112.37 points to 3,162.82 after moving between 3,161.95 and 3,262.54.

The broader all-shares index was down 48.13 points to 1,967.92.

Losers beat gainers 89 to 32 with 43 stocks unchanged.

Volume amounted to 3.4 billion shares worth P3.7 billion.

"Following the consecutive run-up in recent sessions, the market is just ripe for a healthy correction," said Grace Cerdenia of 2TradeAsia.

"There is no other big news other than Wall Street’s fall that would warrant a fundamental shift by investors with regard to the country’s macro-economic prospects," she added.

"The decline on Wall Street and its subsequent effect on Asian markets gave impetus for investors, especially for short-term players, to lock profits on recent gains," said Jasper Jimenez of BDO Securities Corp.

Top-traded SM Investments Corp fell P20 to P370.

Philippine Long Distance Telephone Co. (PLDT) retreated P165 to P2,630, extending the losses of its New York-traded American Depositary Receipts.

Its rival, Globe Telecom Inc., was down five to P1,290.

Metropolitan Bank and Trust Co edged down three to P57 while Bank of the Philippine Islands fell two to P69.50.

Conglomerate Ayala Corp. also fell P15 to P610 while its unit Ayala Land Inc. declined 75 centavos to P16.

Food and beverage giant San Miguel Corp. saw both its A and B shares holding steady at P63 and P75, respectively.

"The market has to take a pause somewhere," said Jerome Gonzalez, who helps manage about $40 million at PhilEquity Fund in Manila. "This is a healthy pullback. We aren’t seeing any excesses that come with a rally. Share prices can’t just keep on climbing."

Yesterday’s fall was triggered in part by the declines in the Standard & Poor’s 500 Index and the Dow Jones Industrial Average, according to Jonathan Ravelas, market strategist at Banco de Oro. Both US measures tumbled the most since November after energy and pharmaceutical companies reported quarterly results that disappointed investors and existing home sales dropped more than economists forecast. — AFP

 

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