PSEi down on profit taking before Q1 GDP, US CPI

PHILIPPINE SHARES declined on Monday on profit taking as investors await the release of first-quarter (Q1) gross domestic product (GDP) data. 

The Philippine Stock Exchange index (PSEi) fell by 84.92 points or 1.27% to close at 6,600.74 on Monday, while the broader all shares index went down by 30.42 points or 0.85% to 3,525.64.

“Investors turned into profit takers after a strong week in local equities last week, and ahead of the Philippine GDP,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“Globally, the key economic data releases stateside this week are the wholesale inventories report on Monday… and CPI reading on May 11, as well as monthly budget statement, initial jobless claims and PPI (producer price index) on May 11,” Mr Limlingan added.

The PSEi dropped on “profit taking ahead of US CPI (consumer price index) on May 10 and first-quarter Philippine GDP on May 11,” Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce likewise said in a Viber message.

Economic growth likely eased in the first quarter as the boost from pent-up demand following the coronavirus pandemic continues to fade and amid elevated inflation that has resulted in higher interest rates, analysts said.

A BusinessWorld poll of 23 economists conducted last week yielded a median estimate of 6.1% for first-quarter GDP growth.

If realized, this would be slower than revised 7.1% growth in the fourth quarter of 2022, and the 8% expansion recorded in the same period last year.

The government targets 6-7% GDP growth for this year. The economy expanded by 7.6% in 2022.

Meanwhile, the US CPI climbed 0.1% in March after advancing 0.4% in February.

In the 12 months through March, the CPI increased 5%, the smallest year-on-year gain since May 2021. The CPI rose 6% on a year-on-year basis in February.

On the other hand, the US PPI for final demand dropped 0.5% in March after being unchanged in February.

In the 12 months through March, the PPI increased 2.7%, following a 4.9% advance in February.

All sectoral indices closed lower on Monday. Property went down by 80.66 points or 2.88% to 2,717.11; services dropped by 20.93 points or 1.30% to 1,580.91; financials decreased by 21.42 points or 1.13% to 1,866.75; mining and oil fell by 114.61 points or 1.07% to 10,554.28; holding firms declined by 36.42 points or 0.55% to 6,487.61; and industrials lost 26.07 points or 0.27% to end at 9,571.06.

Value turnover dropped to PHP 5.87 billion on Monday with 718.19 million shares changing hands from the PHP 11.45 billion with 2.51 billion issues traded on Friday.

Decliners outnumbered advancers, 92 versus 86, while 58 names closed unchanged.

Net foreign buying stood at PHP 8.87 million on Monday versus the PHP 2.68 billion in net selling seen on Friday. — By AHH