PHILIPPINE shares declined on Wednesday, along with other markets in the region, as investors pocketed their gains and with concerns over new coronavirus disease 2019 (COVID-19) variants clouding market sentiment.
The Philippine Stock Exchange index (PSEi) declined by 49.43 points or 0.7% to close at 6,943 on Wednesday, while the broader all shares index lost 26.50 points or 0.61% to 4,272.16.
“Market continued on profit taking due to lackluster news on the local front and with most Asian markets [down],” Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said in a text message. “Most investors are on the sidelines with value turnover below [the] daily average of seven billion and foreign investors on the selling mode.”
Value turnover decreased to P4.46 billion with 1.70 billion shares traded on Wednesday from the P5.1 billion with 2.51 billion issues seen on Tuesday.
Meanwhile, net foreign selling surged to P211.97 million on Wednesday from P37.55 million the previous day.
“Delta and Lambda virus variant, low vaccine supply, and peso weakness toward P50 on the dollar have prompted investors’ profit taking. But recent government dollar borrowing should temper dollar demand surge while vaccine supply should improve as more of it arrive this month,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message.
“These worries are making the PSEi look very pricey at PE (price-to-earnings ratio) of 19.67x on this year’s earnings with much of the positive news flow on inflation, unemployment and consumer confidence fully digested upon breakout above 7,000,” she added.
The Lambda COVID-19 strain is said to be more dangerous than the Delta variant, which is already a more transmissible version of the disease. The Lambda variant has been detected in over 30 countries in the past month.
The Philippines has not yet reported any Lambda COVID-19 infection. However, it logged 19 cases of the Delta variant as of Monday.
The country expects to receive around 30 million COVID-19 jabs in July and August.
All sectoral indices closed in the red on Wednesday. Services went down by 21.09 points or 1.29% to 1,606.97; mining and oil dropped 97.06 points or 0.98% to 9,770.84; holding firms shed 53.65 points or 0.76% to finish at 6,956.88; financials inched down by 9.66 points or 0.63% to 1,502.76; industrials lost 53.39 points or 0.54% to 9,684.85; and property declined by 16.30 points or 0.48% to 3,351.95.
Decliners beat advancers, 127 versus 59, while 57 names remained unchanged.
For today, investors will continue to monitor economic data releases amid a lack of fresh leads.
“[Market will move] most probably sideways with positive bias if industrial production goes up for the month of May,” Diversified Securities’ Mr. Pangan said. — Keren Concepcion G. Valmonte