Shares slip on 2nd day of profit taking

The stock market tumbled out of the 6,400 territory on Wednesday as cautious investors continued to take in profits.

The Philippine Stock Exchange index (PSEi) lost 0.58 percent or 37.29 points to close at its intraday low of 6,377.79 while the wider All Shares shed 0.26 percent or 9.82 points to finish at 3,808.29.

AAA Equities Head of Research Christopher Mangun attributed the latest decline to an increase in selling pressure, saying “more investors are now securing profits from the recent rally, which is giving investors who have not been able to ride the rally a chance to pick up shares at lower prices.”

The main index last Friday closed at 6,484.06, the highest since its 6,476.24 finish on June 11.

Investors, Mangun added, also realized that the figures are not as bad as expected, as more reports of corporate earnings in the third quarter are released.

“With more mobility and business restrictions lifted by the day, economic activity will continue to pick up,” Mangun said.

Philstocks Financial Inc. research associate Piper Chaucer Tan described Wednesday’s trading as “whipsaw,” saying more investors were cashing in amid the uncertainity on Wall Street, which was fueled by a new surge in coronavirus disease 2019 (Covid-19) cases in the world’s largest economy.

The Dow Jones and S&P 500 slid overnight by 0.8 percent and 0.3 percent, respectively; Nasdaq gained 0.64 percent.

“The market may test the 6,000 level and may take profits, thus we expect selling pressure coming off from the investors,” Tan said.

Most local sectors closed in the red, with property leading decliners at 2.04 percent. Industrial and services were the exceptions, adding 0.49 percent and 0.15 percent, respectively.

Total volume turnover was at 1.75 billion shares, valued at P6.8 billion.

Winners beat losers, 112 to 89, while 46 securities were unchanged.