Gains capped on sell-off in Consunji-led stocks

Business World Online
Posted on July 22, 2015 08:00:00 PM

LOCAL share prices squeezed out modest gains yesterday in anticipation of stronger earnings reports, but the sell-off in Consunji-led index stocks Semirara Mining and Power Corp. and parent DMCI Holdings, Inc. continued to weigh on the market.

A LONE water fountain reluctantly spews a mini show at the Philippine Stock Exchange headquarters in Makati -- AFP
The Philippine Stock Exchange index (PSEi) went up by 7.66 points or 0.1% to finish at the session’s high of 7,635.62, reversing an intraday drop of as much as 0.57%.

The all-shares index rose 2.78 points or 0.06% to end at 4,358.50.

“The rise of the market was earnings-driven. It’s basically showing optimism that second-quarter earnings will be better than what has been reported in the first quarter,” Lexter L. Azurin, head of research at Unicapital Securities, Inc., said in a phone interview.

Among the 30 companies that form the PSEi, only seven firms finished in the red, Mr. Azurin said. These included Semirara and DMCI Holdings stocks, which continued to be dumped by investors.

The Department of Energy (DoE) ordered Semirara to stop its coal shipments pending the government investigation on the cause of the landslide in its Panian mine that killed nine employees. Likewise, the DoE had suspended its mining operations.

“Among the biggest laggards were Semirara and DMCI. If you exclude those drops, the market would have been higher by an additional 12 points,” Mr. Azurin said.

Semirara shares sank P11.40 or 9.31% to P111.10 apiece and DMCI Holdings plunged 64 centavos or 5.1% to P11.92 each.

The local market bucked the weakness in most Asian markets after the Dow Jones industrial average suffered a triple-digit drop on disappointing earnings reports from bellwethers IBM Corp. and United Technologies Corp.

“You can expect this type of correction because we’ve been going up for quite a bit. Everybody’s also on a wait-and-see attitude ahead of the influx of the second-quarter earnings reports,” April Lynn Lee-Tan, head of research at COL Financial Group, Inc., said by phone.

Counters finished mixed. Property led the market’s gains, rising 20.16 points or 0.63% to 3,173.16. Likewise, services jumped 7.47 points or 0.34% to 2,153.29; industrials added 14.97 points or 0.13% to 11,361.78; and holding firms climbed 3.73 points or 0.05% to 6,904.88.

On the other hand, mining and oil lost 571.87 points or 4.6% to 11,857.28; and financials dropped 1.57 points or 0.09% to 1,686.04.

Value turnover increased to P7.55 billion after 3.15 billion shares changed hands, from P6.60 billion in the previous session.

Gainers nipped losers, 87 to 79, while 46 issues closed flat. Net foreign selling reached P265.71 million, a turnaround from the net foreign buying of P662.20 million registered on Tuesday.

“The primary focus in the next few weeks will be earnings. The market will be swayed by earnings data,” Unicapital’s Mr. Azurin said. -- Krista Angela M. Montealegre source