Philippines share prices closed 0.62 percent lower on Tuesday as investors sold shares in blue chips due to concerns that higher oil prices could weaken consumer demand and hurt profits, dealers said.
They said there were also concerns that the government may not fully implement a crucial expanded value-added tax (VAT) even if the tax, which has been suspended by the Supreme Court, should be finally upheld.
The composite index slipped 12.41 points to 1,993.58 after trading between 1,986.57 and 2,005.99. Volume amounted to 375.05 million shares worth 931.6 million pesos (16.7 million dollars).
The broader all-shares index retreated 5.07 points to 1,209.91.
Decliners beat risers 47 to 27, while 51 stocks ended unchanged.
The Philippine peso traded at an average of 55.809 at the end of stock market trading on Tuesday.
"The market continues to keep its focus on the effects of higher crude. Investors are now re-evaluating their projections on how the economy and companies are likely to perform, given the current scenario," said Jonathan Ravelas of Banco de Oro.
"An air of negativism has surrounded the market again. Some people are of the opinion that the line between politics and market fundamentals is again blurred," said Mark Alan Canizares of Citiseconline.com.
He was referring to calls that President Gloria Arroyo defer the implementation of a crucial expanded value-added tax (VAT) in order to cushion the effect of oil price increases.
Philippine Long Distance Telephone PLDT was the most active stock, closing 20 pesos lower at 1,620. Rival Globe Telecom retreated 30 to 780.
Ayala Land gained 10 centavos to 8.30 pesos while parent Ayala Corp ended unchanged at 315 pesos. Bank of the Philippine Islands was steady at 51.50.
San Miguel A shares, limited to Filipino investors, ended steady at 69 pesos while San Miguel B shares, available to foreign investors, fell 50 centavos to 99.50 pesos.