Stocks fell on a third day, as investors cut holdings of higher-yielding assets before the US and Japanese central banks announce policy decisions this week.
The Philippine Stock Exchange index, the 30-company benchmark, lost 38 points, or 0.5 percent, to close at 7,211.92 Tuesday. The bellwether was still up 3.7 percent since the start of the year.
The heavier index, representing all shares, also fell 61 points, or 1.4 percent, to settle at 4,321.54, on a value turnover of P10 billion.
Six of the 20 most active stocks ended in the green, led by Island Information & Technology Inc., which jumped 26.9 percent to P0.425. Universal Robina Corp., a food manufacturer, climbed 2.2 percent to P209.60, while Metro Pacific Investments Corp. rose 1.2 percent to P5.83.
Meanwhile, Asian shares edged down Tuesday as dealers waited for the Federal Reserve and Bank of Japan’s next policy meetings later in the week, but oil prices rallied more than one percent after the previous day’s sharp losses.
Having piled up healthy gains last week, analysts said traders were moving cautiously as they hope for some forward guidance on the Fed’s policy plans, while the corporate earnings season also kicks off.
“Overall we’re in wait-and-see mode,” Toshihiko Matsuno, chief strategist at SMBC Friend Securities Co. in Tokyo, told Bloomberg News.
“It’s easier for investors to lighten their positions so damage will be limited in case something unexpected happens in US and Japanese monetary policy,” he said.
After the turmoil across world markets at the start of the year, the Fed lowered its expectations for rate hikes this year saying it would closely watch overseas developments before moving.
Traders have predicted the next rise will be towards the end of the year but every utterance from the bank will be pored over for clues about its thinking.
Asian markets were mostly down in edgy trade.
Japan’s Nikkei index ended the morning 1.3 percent lower, with the yen holding Monday’s gains against the dollar despite speculation that the country’s central bank will ramp up its stimulus after a two-day policy meeting Thursday.
The dollar was back below 110 yen, having pushed towards 112 yen at the end of last week on speculation the central bank will unveil fresh measures.
The BoJ has been tipped to further ease monetary policy after this month’s double earthquake in the south of Japan that led to the closure of factories at a time when the economy is already stuttering.
Wednesday sees the start of the earnings season, with Sony and Nintendo among a slate of big-name firms set this week to report results for the fiscal year through March.
Among other markets Hong Kong was down 0.5 percent and Seoul shed 0.4 percent. Shanghai eased 0.2 percent.
with Bloomberg, AFP