PSEi dips as China growth falls below forecast

The Philippine Stock Exchange Index (PSEi) declined for the second straight day on Wednesday, tracking the drop in most Asian stocks after China’s fourth-quarter growth figures failed to meet expectations, analysts said.

The main index fell by 0.97% or 64.49 points to close at 6,572.51, while the broader all-share index declined by 0.84% or 29.57 points to 3,476.66.

“Most Asian stocks dropped after China’s fourth-quarter gross domestic product (GDP) figures fell below expectations at 5.2%, lower than the 5.3% forecast by analysts,” Philstocks Financial, Inc. research analyst Claire T. Alviar said in a Viber message. “This further weighed down on sentiment since China is one of our top trading partners.”

Investor sentiment was also dampened by expectations that the government won’t hit economic growth targets through 2025 given high interest rates.

“Market sentiment was dampened by the anticipation of the Bangko Sentral ng Pilipinas that GDP growth might fall short of the government’s targets through 2025 due to the impact of high interest rates,” Ms. Alviar said.

At its December meeting, the Development Budget Coordination Committee kept its growth target of 6-7% for 2023.

But it lowered the high end of the target this year to 6.5-7.5% from 6.5-8%, while keeping the 6.5-8% goal for 2025 to 2028.

The local bourse declined along with Hong Kong and Chinese stock markets after the release of Chinese economic data, Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message.

“Philippine shares continued to slide with Hong Kong and China equities plunging after the latest growth print showed that the second-largest economy grew at the slowest pace in three decades when excluding pandemic [figures],” he said. 

Sectoral indexes declined across the board, led by mining and oil which fell by 2.01% or 191.64 points to 9,305.75. The property index lost 1.61% or 46.55 points to 2,836.02, while holding firms dropped by 1.19% or 75.85 points to 6,290.34.

Industrials went down by 0.99% or 90.75 points to 9,048.45; services slid by 0.73% or 12.07 points to 1,624.33; and financials decreased by 0.04% or 0.77 points to 1,838.20.

“Among the index members, GT Capital Holdings, Inc. was at the top, increasing by 1.78%. However, Converge ICT Solutions, Inc. lost the most by 5.48%,” Ms. Alviar said. 

Value turnover rose to PHP 6.68 billion with 590.13 million issues on Wednesday changing hands from the 501.41 million issues worth PHP 5.98 billion on Tuesday. 

Decliners outpaced advancers 108 against 80, while 50 names were unchanged.

Net foreign buying reached PHP 63.22 million on Wednesday, lower than the PHP 461.86 million net foreign inflows a day earlier.