MANILA, 12 May — The Manila bourse went the southward path last week as many investors kept a tight hold on their funds due to a combination of not-so-good news from the United States and the lingering effects of bad corporate news from a number of companies.
It was no surprise then that the composite index shed 24.8 points or 1.8 percent before stopping at 1,350.77 points.
Turnovers were just as dismal with value turnover dropping 9 percent to 2.97 billion pesos ($60 million) and actual trading consisting of 1.23 billion shares, 38 percent lower than the volume the previous week.
Even the news of the Philippine peso gaining strength was not enough to pull the market up. Analysts said this is because some stock market investors got stuck in the dollar market.
Others said the past weeks’ dampened interest in the market was not really surprising. "They’re on a wait-and-see stance. Foreign investors are dictating the tempo while the local investors are following the lead," said Rolando Pineda of First Orient Securities.
An analyst also said the disappointing unemployment reports of the United States was carried over to the local economy. "This overshadowed reports of the appreciation of the peso," Jose Vistan, senior analyst of AB Capital Securities, Inc. said.
The United States unemployment rate reportedly shot up to its highest level in more than 7-1/2 years in April.
With this, it may take some time before the Federal Reserve could raise interest rates.
Analysts at BPI Securities Corp. noted that "investors continue to shy away from the market in light of weak corporate earnings and lack of fresh developments."
