MANILA, Philippines - With stock prices and trading volumes remaining high, Finance Secretary Cesar Purisima says the government is keeping a close watch on the stock market.
He says prices are still within bounds, with listed companies reporting rising profits.
"This is something we at the DOF and Bangko Sentral are monitoring closely. If you look at the PSE, it's a very active market, sometimes it goes up and sometimes it goes down but when you look at fundamentals, I believe it's still within bounds of what is generally acceptable," Purisima said.
"The important thing is that companies listed in the stock exchange continue to increase their income because that's what's important, that values are driven by profitability of companies. So long as companies improve profitability then valuations will follow," he added.
The PSE slumped for a sixth straight day on Monday. Analyst Jun Calaycay of Accord Capital said it is due to expensive share prices.
"High valuations, technical considerations, all of this combined for a much-awaited correction. We have been waiting for a correction for an extended period of time. Now we found enough reason to really dump the shares and book profits," he said. - With reports from Warren de Guzman, ANC and Alvin Elchico, ABS-CBN News