Foreign investors keep dumping Philippine stocks

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philippine_stock_exchangePhilippine stocks, once favoured by emerging-market investors, were under heavy selling pressure siege from April to June, Reuters data shows. Net foreign selling in the period rose to the highest since the 1998 Asian crisis and exceeded outflows from some major stock markets in the region.

Net foreign selling reached 31.81 billion pesos ($706 million), according to figures from the Philippine Stock Exchange (PSE). The net selling in the second quarter was a reversal of net foreign buying of 28.3 billion pesos a year earlier and 48.9 billion pesos in the first quarter. It also outpaced net foreign net selling of $72.7 million in Indonesia and $61.4 million in Thailand. Vietnam saw $8 million in net foreign purchases, Reuters reported.

The Philippine stock market was attacked from all sides. First-quarter economic growth came in below forecasts, and disappointing corporate earnings prompted fund managers to take profit. Valuations on Manila’s broad index had soared to 20, topping the 10-year average of around 16 and more expensive than Jakarta’s 15.96 and Bangkok’s 17. Foreign investors also rotated out of Manila stocks and into booming markets in mainland China while funds also migrated to Japan.

On Friday, July 3, share prices were mostly down on the PSE as fears of a contagion from the Greek debt crisis weighed on investor sentiment. Analysts said investors decided to pocket modest gains as caution prevailed in anticipation of the July 5 austerity vote which could determine whether Greece will stay in the euro zone or not.

But the PSE expects investors to increase their allocation of emerging Asian stocks including the Philippines when markets calm down over the euro crisis. In the mid-term, the run-up to the 2016 presidential election in the Philippines should also boost the domestic stock market.

 

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Reading Time: 2 minutes

Philippine stocks, once favoured by emerging-market investors, were under heavy selling pressure siege from April to June, Reuters data shows. Net foreign selling in the period rose to the highest since the 1998 Asian crisis and exceeded outflows from some major stock markets in the region.

Reading Time: 2 minutes

philippine_stock_exchangePhilippine stocks, once favoured by emerging-market investors, were under heavy selling pressure siege from April to June, Reuters data shows. Net foreign selling in the period rose to the highest since the 1998 Asian crisis and exceeded outflows from some major stock markets in the region.

Net foreign selling reached 31.81 billion pesos ($706 million), according to figures from the Philippine Stock Exchange (PSE). The net selling in the second quarter was a reversal of net foreign buying of 28.3 billion pesos a year earlier and 48.9 billion pesos in the first quarter. It also outpaced net foreign net selling of $72.7 million in Indonesia and $61.4 million in Thailand. Vietnam saw $8 million in net foreign purchases, Reuters reported.

The Philippine stock market was attacked from all sides. First-quarter economic growth came in below forecasts, and disappointing corporate earnings prompted fund managers to take profit. Valuations on Manila’s broad index had soared to 20, topping the 10-year average of around 16 and more expensive than Jakarta’s 15.96 and Bangkok’s 17. Foreign investors also rotated out of Manila stocks and into booming markets in mainland China while funds also migrated to Japan.

On Friday, July 3, share prices were mostly down on the PSE as fears of a contagion from the Greek debt crisis weighed on investor sentiment. Analysts said investors decided to pocket modest gains as caution prevailed in anticipation of the July 5 austerity vote which could determine whether Greece will stay in the euro zone or not.

But the PSE expects investors to increase their allocation of emerging Asian stocks including the Philippines when markets calm down over the euro crisis. In the mid-term, the run-up to the 2016 presidential election in the Philippines should also boost the domestic stock market.

 

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