Philippines share prices closed 0.40 percent lower on Monday as investors took profits from a promising start amid continuing worries about the US subprime credit crisis, dealers said. They said caution dominated sentiment as investors opted to await the outcome of the US Federal Reserve's move Friday to inject billions of dollars into the country's banking sector to calm the markets.
The composite index lost 14.93 points to 3,267.03, off a high 3,310.24. The broader all-share index fell 9.20 points to 2,097.35. Out of 154 stocks traded, 83 declined, 28 advanced while 43 ended unchanged. A total of 2.7 billion shares worth 3.7 billion pesos (81.16 million dollars) were traded.
"There was a lot of selling pressure because of the uncertainty surrounding the US subprime loan problems. Even with central banks world-wide pumping cash into the financial system, it will take time before investor confidence is restored," said Jose Vistan of AB Capital Securities.
Worries of a likely credit crunch have now overshadowed expectations of better corporate results from local companies, he said. Gomer Tan of Regina Capital Development Corp said the market is likely to consolidate in the next four to six weeks as the so-called "ghost month" sets in.
The ghost month is a traditional Chinese festival that falls on the seventh month in the Chinese calendar. During this period, stock trading is considered an unnecessary expense and this means less liquidity for traders. This year, the ghost month starts August 13 and ends on September 10.
Ayala Corp lost 15 pesos to 450. Bank of the Philippine Islands, its banking arm, shed 1.50 pesos to 61. Megaworld lost 10 centavos to 3.25 pesos while Philippine Long Distance Telephone or PLDT bucked the market's weakness, edging up 15 pesos to 2,570. San Miguel A and B were both unchanged at 68 and 70 pesos, respectively.
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