The local stock market weakened despite the announcement of a lower inflation rate as investors opted to sell on news.

The main index dropped 43.95 points or 0.62 percent to close at 6,992.43 with the Property sector registering the biggest decline while the Services counter was the only one that managed to advance.

Volume was a little higher but still low at 2.51 billion shares worth P5.1 billion as losers outnumbered advancers 112 to 96 with 52 unchanged.

“Philippine shares slipped below the 7,000 mark as investors sold on news with the release of June CPI which was an improvement from the previous reading,” said Regina Capital Development Corporation Managing Director Luis Limlingan.

He added that, “Meanwhile, fund managers are also awaiting the movement of the US market, which will be starting trading later after coming from the Independence Day holiday. The futures point to a muted start during the shortened trading week.”

Philstocks Financial Senior Supervisor for Research Japhet Tantiangco said “The local bourse declined as investors took profits out of its preceding 3-day rally.”

He noted that, “Market sentiment was also weighed by the rising oil prices as the OPEC+ fails to reach a deal on their oil production. The rising oil prices pose upside risk to our inflation rate.”

Tantiangco said “Tuesday’s performance is also seen as a show of concern of investors over the national government’s rising outstanding debt level with the end-May 2021 figure reaching P11.07 trillion.”

AAA Equities Head of Research Chris Mangun said “The PSEi pulled back and fell below the 7,000 key level despite better-than-expected inflation data. There was very little excitement about the confirmed continuing deceleration of inflation, which means that it was already priced in by the market.”

He pointed out that, “Trading volumes remain below the daily average and just about half of what we saw when the market rallied at the beginning of the year. This tells us that risk appetite may be peaking, which is also how the technicals are looking. The lack of potentially positive catalysts in the short-term will incite profit-taking.”