Philippine shares close lower for 2nd day on Estrada, US concerns

Philippine shares close lower for 2nd day on Estrada, US concerns - UPDATE

	Published : Tue, 11 Sep 2007 06:31 By : Agencies Print this Story

MANILA (Thomson Financial) - Philippine shares closed weaker for the second straight session on Tuesday on heightened caution

a day before the verdict in the six-year corruption trial of ousted president Joseph Estrada is

handed down.

News that Philippine exports grew a little faster in July failed to lift investor sentiment amid a

shaky outlook for the US economy, the biggest market for Manila's exports.

How far the Federal Reserve will go, when it holds its interest rate-setting meeting Sept 18, to

loosen up credit markets and ease global fears of a recession in the US is a key issue for

investors.

Manila's composite index ended down 13.11 points, or 0.4 percent, at 3,267.97, its worst finish in two weeks but off the day's low of 3,258.09.

The all-share index fell 11.93 points, or 0.6 percent, to 2,067.86.

There were 83 decliners and 30 advancers, while 51 stocks were flat.

A total of 2.9 billion shares worth 3.7 billion pesos were traded.

'The political tension is causing some nervousness, and unfortunately we also have to contend

with external concerns,' said Jose Vistan Jr, research director at AB Capital Securities.

The Philippine military on Tuesday went on high alert to thwart violence that could explode when

the court hands down its verdict on Estrada, who was accused of amassing 80 million dollars

through tax kickbacks and bribes from illegal gambling operators when he was still president.

Despite his ouster through a military-backed popular revolt in 2001, the former movie actor still

enjoys the support of many poor Filipinos, while his successor Gloria Arroyo suffers from low

popularity ratings.

He has denied the allegations, accusing the business elite, Arroyo and the powerful Roman

Catholic church of conspiring against him because of his populist platform.

Political analysts have warned that Estrada's acquittal will put the legality of Arroyo's presidency in question.

Estrada said Tuesday he is prepared to spend the rest of his life in jail if found guilty, ruling out the possibility that he will seek presidential pardon.

Military chief General Hermogenes Esperon said 'augmentation forces' were assembled in military bases around Manila and would quickly respond to help police control Estrada supporters if they launch street protests on Wednesday.

He said pro-Estrada forces may become unruly if the former movie star-turned-president is found guilty on charges of massive corruption.

'Investors will remain on full alert for any sign of turmoil both on the domestic political front and on the international financial markets,' Vistan said.

Index leader Philippine Long Distance Telephone Co extended Monday's losses, down 15 pesos or 0.6 percent to 2,670 pesos.

Manila Electric Co plunged 3.50 pesos or 4.4 percent to 75.50 pesos.

Bucking the trend, Ayala Corp rose 7.50 pesos or 1.6 percent to 470 pesos after the nation's largest conglomerate said it will buy back common shares worth 2.5 billion pesos, or about 1.3

percent of its current market capitalization.

(1 US dollar = 46.82 pesos)

enrico.delacruz@thomson.com

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Philippine shares close lower for 2nd day on Estrada, US concerns - UPDATE