Manila bourse experiences worst trading week

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By Julie Javellana Santos, Special to Arab News
Publication Date: 
Sun, 2002-06-16 03:00

MANILA, 16 June — The Manila bourse experienced one of its worst trading weeks this year, mostly because of continuing uncertainty of the control of its best selling stock, Philippine Long Distance Telephone Co. (PLDT).

The rescue of the hostages from the clutches of the Abu Sayyaf rebel group in the southern Philippines should have caused the improvement of some share prices but for the fact that two of the three hostages died in the course of the rescue effort.

As it was, the market barometer shed 9 points or 0.7 percent as it closed at 1,265.75 points. Market turnovers were lower last week with value turnover falling 33 percent to P1.9 billion ($37.5 million) and actual trading plunging 54 percent to 954 million shares of stock. Telephone firm PLDT has been the market’s focus for more than a week now after the wealthy Gokongwei family announced it forged an agreement to acquire the Philippine telecom and property assets of Hong Kong based First Pacific Co. via a joint venture.

“The market is cautious since that creates uncertainty about the direction of PLDT. It affects management focus. Investors would like to take a safer position by liquidating some holdings,” AB Capital stock analyst Jose Vistan said.

“There might be a technical rebound anytime, but in terms of a sustainable rebound, it’s hard to say,” Vistan said.

“We also have deficit concerns. The government may have revised the economic targets but there are lingering concerns that we might not meet our budget deficit target which will negatively impact on our economy,” Vistan said.

BPI Securities stock analyst Robert Cano said the market remained depressed due to lack of solid leads.

“Investors remained sidelined as they await more developments, especially on the sale of First Pacific’s stake in PLDT,” Cano said.

The movement in the market next week, as in the past weeks, will be dictated by the continuing power struggle within PLDT. Analysts say the market will be in a virtual limbo until this is resolved.

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