Interest rates to weigh down RP shares next week: dealer

ABS-CBN News

Posted at Jun 13 2008 06:13 PM | Updated as of Jun 14 2008 02:13 AM

Agence France-Presse

Philippine share prices are likely to continue taking a beating next week from high interest rates, spawned by inflationary pressures both here and abroad, a dealer told AFP on Friday.

"Interest rates in the Philippines and likewise globally now have a tendency to be pushed upwards due to inflationary concerns," said Nestor Aguila of DA Market Securities Inc.

"Investors are not looking at equities. They would rather be positioned in interest bearing instruments," he said.

While many local stocks are trading below their book and net asset value, investors still want to see how their quarterly earnings fared in the face of higher oil prices and higher inflation rates, said Aguila.

"Investors... would want to get a get a deeper discount on these issues before we start nibbling on them," he said.

For the week to June 13, the composite index fell 6.75 percent or by 184.97 points to 2,554.73 points.

Average daily turnover rose to 3.323 billion pesos (74.9 million dollars) from 2.41 billion pesos in the previous week.

Aguila said the index would move between 2,500 to 2,630 points in the coming week.