SM Investments Leads Drop Among Philippine Stocks After MSCI Cut
The stock slumped 7.3 percent to 809 pesos at the noon break in Manila, heading for the lowest close since June 26. It was the biggest contributor to a plunge in the Philippine Stock Exchange Index (PCOMP), which fell 1.3 percent, poised for the biggest loss since Aug. 6.
MSCI cut SM Investments’s weighting in several of its gauges such as the Emerging Markets Index and Asia Pacific Index in its quarterly review.
“SM Investments dragged the index down, especially since the MSCI weighting cut was unexpected,” Jomar Lacson, an analyst at brokerage Campos Lanuza & Co., said by phone in Manila. “The market’s decline could also be partly traced to losses in some stocks including San Miguel and JG Summit, whose earnings were affected by huge foreign-currency losses.”
San Miguel Corp., the biggest Philippine company, lost 0.1 percent to 87.4 pesos, paring an earlier 2.9 percent drop. The company posted its first quarterly loss since the period ended December 2008 as the peso weakened.
JG Summit Holdings Inc. (JGS) declined 4.8 percent to 40 pesos, heading for the sharpest drop since June 13. The company yesterday said net income in the second quarter fell to 310.8 million pesos ($7.1 million) from 2.56 billion pesos a year earlier on a 2.88 billion-peso foreign-exchange loss.
The peso has weakened more than 6 percent this year, the fourth-worst performer in a basket of 11 Asian currencies tracked by Bloomberg.
“Investors didn’t really expect foreign-currency losses for some of these companies to be this big,” Lacson said.
To contact the reporter on this story: Norman P. Aquino in Manila at firstname.lastname@example.org