PSE DECLINES ON FOREIGN SELLING

The Philippine Stock Exchange (PSE) index today declined in what market watchers said were cut-loss orders from foreign investors as the effects of the failure of authorities to bring charges against Abra Mining for selling unlisted stocks resonated in the foreign investment community leading to a 62.23 points loss or down 0.94 percent to 6,545.55 points.

Big-name blue chips posted substantial losses today as foreign investors left the local market because of the perception that the PSE is wishy-washy in its treatment of the scandalous sale of unlisted stocks by Abra Mining that were later flagged and that led to the suspension of its trading.

Before the suspension of March 4 was imposed trading in Abra Mining accounted for about 70 percent of total trades as investors lined up for the issue touted for its rumored partnerships. However, on the day before, the suspension transactions in Abra Mining went down prompting investors to suspect that there was inside info about the suspension the next day.

Net foreign selling amounted to P481 million in thin trade of P4.698 billion with 103 gainers, 104 losers, and 46 shares unchanged. A trader at a foreign brokerage house said that foreign investors were cutting on their losses due to the PSE's inaction. In fact, the move by PSE president Ramon Monzon to seek for a white knight to allow the suspended mining firm to be traded again has not been received well since it would amount to a cop-out, one investor said.

A market investor said that it seemed that Mr. Monzon is not so attuned to stock market workings and his pronouncements for a white knight, while it may look good, does not wash in a stock market world, where there is even disgorgement or when players are forced to cough out their winnings that were made inappropriately as part of sanctions in the stock market industry.

According to the Wall Street Journal, in his past career, Mr. Monzon held the position of President & Chief Executive Officer for Pacific Rim Exports & Holdings Corp., Chief Operating Officer & Executive Vice President at Intercontinental Broadcasting Corp., Chief Operating Officer & Executive Vice President at Radio Philippines Network, Inc., Vice Chairman & Chief Operating Officer at Citadel Holdings, Inc., Chief Operating Officer & Executive Vice President of Sining Makulay, Inc., Chief Operating Officer & Executive Vice President of Banahaw Broadcasting Corp. and Partner at SyCip Gorres Velayo & Co.

He also received an undergraduate degree from the University of Ateneo de Manila, an undergraduate degree from Manuel L. Quezon University, and an MBA from The University of Chicago Booth School of Business.

Last year, the PSE index crumbled to below 5,000 points when foreign investors were unnerved by the decision to halt trading, resulting in cut-loss trades that saw the index drop to a dizzyingly low.

At that time, all the other stock exchanges were open when the COVID-19 reverberated. This time, with the failure to announce the filing of charges or even any investigation on the selling of unissued and unlisted shares in Abra Mining, the foreign investors were again unnerved. "Na Abracadabra," an investor bewailed.

ICTSI, with foreign selling of P124 million out of its total trade of P224 million, went down by 4.05 percent to close at P121, down P3 while SM Prime, lost P1.50 or 4.05 percent to P35.55. Market bellwether SM Investments was unchanged at P970 with foreign selling amounting to P56 million.

One investor reached by The Financial District said that those who bought shares of stock of Abra Mining had their investments frozen and they may have to suffer like in the Passion of Jesus Christ due to the failure of PSE to flag the sale of unissued and unlisted shares of stock during the height of its surge in prices where it went up by as much as 270 percent.

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