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PHILIPPINE stocks fell for the third day, sending the
index to its lowest in more than eight weeks, on concern
spreading credit losses in the US will hamper growth in
the world’s biggest economy.
“There
is no conviction to buy and contradict a sliding market
when there are indications the US economy is sick and
there are warning flags showing up domestically,’’ said
Rico Gomez, who helps manage about $1 billion in assets
at Rizal Commercial Banking Corp.
SM
Investments Corp. and Globe Telecom Inc. paced a slide
among the nation’s biggest companies. PNOC-Energy
Development Corp. (PNOC-EDC) advanced, rebounding from a
record drop, after the government sold its 60-percent
stake in the company. San Miguel Corp., one of the
losers in the bidding, declined.
The
Philippine Stock Exchange index lost 31.55, or 0.9
percent, to close at 3,478.94, its lowest since
September 26. The benchmark has lost 10 percent since
closing at a record on October 8.
SM
Investments, which owns the largest Philippine grocer
and department store chains, slid P15, or 4.4 percent,
to P330, its biggest loss since September 10. Globe
Telecom, the nation’s No.2 mobile-phone company,
declined P65, or 4.4 percent, to P1,405, completing a 16
percent, six-day slide.
US
stocks fell, wiping out this year’s gain for the
Standard & Poor’s 500 Index, after concern that mortgage
defaults triggered by a housing slump will spread
through the economy.
The US
is the biggest market for Philippine products and home
to the biggest Filipino communities overseas. Exports
make up 40 percent of the Philippine economy and funds
repatriated home by overseas Filipinos contribute at
least 10 percent, fueling spending on food, mobile
phones, cars and homes.
Ayala
Land Inc., which makes at least 30 percent of its home
sales to overseas Filipinos and their families, fell 25
centavos, or 1.6 percent, to P15.75. Megaworld Corp.,
the No.2 builder by market value and which makes 20
percent of home sales to Filipinos abroad, lost 10
centavos, or 2.6 percent, to P3.80.
The
stock benchmark on November 20 posted its biggest drop
in four weeks, slumping 2.9 percent ahead of a
government report that showed tax collections were below
target, raising doubts over President Gloria Arroyo’s
plan of balancing the budget.
“Hitting
the tax-revenue target is a more sustainable path to
wipe out the deficit,’’ Gomez said. “Balancing the
budget through asset sales is not a permanent
solution.’’
PNOC-EDC,
the country’s largest geothermal-power producer, jumped
60 centavos, or 9.5 percent, to P6.90, after plunging 10
percent Wednesday ahead of a stake sale. The government
last night sold 60 percent of the company for P58.5
billion, helping the government make up for the
shortfall in tax collection.
“Now
that PNOC-EDC will be fully privatized, that would
guarantee higher efficiency,’’ said Allan Yu, who helps
manage the equivalent of $3.17 billion at Metropolitan
Bank. “That would mean greater potential for growth for
the company.’’
Class A
shares of San Miguel, equity reserved in the nation’s
largest food and drinks company, slid P1.50, or 3.2
percent, to P45.50. Its Class B shares, which have no
ownership restrictions, dropped P2, or 4.2 percent, to
P45.50.
Along
with its partner, San Miguel, which is expanding outside
of food and drinks to boost growth, offered P39.5
billion for the shares.
Shares
worth P4.29 billion were traded, 23-percent less than
the six-month daily average. More than two stocks fell
for each that gained in the broader market. (With
reporting by Luzi Ann Javier in Manila.) |
