Despite late bargain-hunting, the stock market tumbled out of the 7,100 territory on Tuesday as fresh catalysts were elusive.
The benchmark Philippine Stock Exchange index (PSEi) slipped by only 0.07 percent or 4.99 points to finish at its intraday high of 7,198.45 while the wider All Shares shed just 0.04 percent or 1.56 points to close at 4,319.74.
Philstocks Financial Inc. research associate Claire Alviar said bargain-hunting in the final hours of trading trimmed the bourse’s losses.
“The overvaluation of the PSEi in terms of the P/E (price-to-earnings) ratio is pushing traders to trade stocks outside the index, where positive sentiment is present,” she explained.
Still, the main index recorded a huge value turnover, which went mostly to second and third liners, according to Alviar.
“Investors could only return to the index stocks once there’s a fresh catalyst already in the market that may break the current resistance of 7,300,” she said.
AAA Equities Head of Research Christopher Mangun said investors remained uncertain and were still unwilling to justify higher valuations for blue chips.
Most of them also remained on the sidelines, waiting for more signs of economic recovery.
Mangun said volatility on blue chips remained subdued, but did see a pickup from Monday.
Despite the uncertainty, he said investors were still willing to take advantage of the optimism in trading second and third liners.
Most indices of local sectors finished in the red, with industrial losing the most at 1.74 percent. Holding firms and financials gained 0.89 percent and 0.06 percent, respectively.
Total volume turnover was at 144.4 billion, valued at P16.03 billion.
Losers and winners almost tied, 115 to 114, while 44 securities were unchanged.