Market ends lower on first day of longer trading hours

The stock market ended lower on the first day of extended trading hours yesterday with investors stepping in to take profits after eight days of gains.

The market began afternoon trading after a gap of 25 years and although volume dropped from Tuesday, traders were convinced it was a move in the right direction.

The main composite index ended down 15.90 points, or 1.08 percent, at 1,453.17 points, with players opting to cash in gains just below 1,480 points, a resistance last breached in March 2001.

Joseph Roxas, president of Eagle Equities, said traders have been expecting the market to correct after the mild rally, and it was just coincidental that this happened during the first day of longer trading hours.

Yesterday’s turnover of P1.386 billion was below Tuesday’s P1.6 billion but no one was expecting an avalanche of additional orders on Day One.

"Not really, this move is for the longer term... we are a step closer to being portrayed as a world-class equities market," said A&A Securities research head Astro del Castillo.

"It provides a bigger window of opportunity for investors both foreign and local, " del Castillo said, adding that "the economy moves 24 hours a day and it’s just prudent for the market to complement that and extend trading a bit."

DBS Vickers associate director of sales Enrique Santa Ana also said the extended session should be judged over the longer term.

"I do not think we should judge it on a day-to-day basis...as long as we provide the availability (to trade longer) it will encourage people in time," he said.

More volatility seen

Others said the longer hours would create more volatility, which was good for trade.

"The longer hours open up more trading opportunities... but we cannot immediately expect a major pickup in volumes in one Market ends lump sum," said Summit Securities president and Philippine Stock Exchange governor Harry Liu. "Foreign investors, in particular, have to be convinced that an economic recovery is underway."

In yesterday’s trading, banks and properties which have been the chief gainers of the market’s eight-day run-up, were heavily sold down.

The properties sub-sector index dipped by 0.96 percent, or 6.36 points, to 653.05 while financials tumbled 2.24 percent, or 13.15 points, to 574.50 points.

"It was clearly profit-taking, everyone said 1,480 points would prove to be a tough resistance point and that’s what happened," United Coconut Planters Bank Trust fund manager Vanessa Lim said.

Liu said the correction was needed after the gains and should give investors a short breather before buying resumes.

However Santa Ana said he would like to see a deeper correction to give new investors an opportunity to enter the market at lower levels.

"Personally, I think we need the market (main index) to go back towards the 1,320 points mark to encourage more buyers to come back..the market has been running up too fast."

Since the start of the year, the index has gained 24.2 percent, making it one of the best-performers in the region.

Among losing banks, Equitable PCI Bank was off P2 at P31.50, Bank of the Philippine Islands shed P1.50 to P68 and Metropolitan Bank fell P1 to P214.

Philippine National Bank was also punished, shedding P1.5 to P73.50, despite saying it had revalued its foreclosed assets showing the bank’s true book value was worth P72.80 per share against the current P40.

Among key properties, mall developer SM Prime Holdings finished down 10 centavos at P7.30 while popular second-liner Filinvest Land was off two centavos at P2.36 .