Share prices slumped Tuesday on profit taking, a day after stocks entered the bull market territory.
The bellwether Philippine Stock Exchange Index fell 101.72 points, or 1.2 percent, to 8,263.57 on a value turnover of P10.7 billion. The bullish sentiment, however, prevailed on other investors, with gainers beating losers, 121 to 85, and 48 issues unchanged
BDO Unibank Inc., the biggest lender in terms of assets, dropped 5.1 percent to P146.20, while Globe Telecom Inc., the second-largest telecommunications firm, declined 4.1 percent to P2,140.
Bank of the Philippine Islands, the third-largest bank, advanced 7.3 percent to P90, while Vista Land & Lifescapes Inc. of the Villar Group, rose 5 percent to P7.79.
Meanwhile, most Asian markets were mixed Tuesday as investors take a breather after a recent rally and as they await the start of the corporate earnings season.
Wall Street provided another record-breaking lead as an expected Federal Reserve interest rate cut continues to fuel optimism, while top Chinese and US negotiators plan to hold fresh trade talks over the phone this week.
Tokyo led losses as it reopened after a long weekend, with the Nikkei ending down 0.7 percent, hit by a stronger yen. Shanghai, Sydney, Wellington and Jakarta also fell but Hong Kong, Singapore, Seoul and Taipei squeezed out gains.
Most markets swung through the day.
With few catalysts to drive buying, attention is now on the release of company earnings, which kicks off in the US this week with JPMorgan Chase, Netflix and Johnson & Johnson among the star names reporting.
However, profits are expected to be down from last year dragged by a global slowdown, weak demand in China, the trade war and a relatively strong US dollar.
US Treasury Secretary Steven Mnuchin said Monday that top American and Chinese trade negotiators are due to speak by telephone in the coming days, but no face-to-face talks have been scheduled yet.
“With no meaningful progress since trade talks were restarted at the G20 sideline meeting at the end of last month, markets will slowly begin to fear that the nightmare scenario of another tranche of US tariffs could be coming to China,” said Edward Moya, senior markets analyst at OANDA.
“The effects of the US-China trade war will continue to especially weigh on Asia.”
Dealers are also keeping an eye on Beijing to see if it unveils any economic stimulus as data on Monday showed second-quarter growth at its weakest pace for almost three decades.
But Bob Doll, at Nuveen Asset Management, warned markets remained volatile.
“We are concerned about complacency as investors seem to believe the Fed will save the day, the US-China trade dispute will be resolved relatively soon and massive China stimulus will boost global growth,” he said.
“We think this combination is a tall order. As a result, market risks lean more to the downside.” With AFP