PH stocks decline on last-minute profit taking

Shares declined on Monday due to last-minute profit taking as investors await the release of July inflation data this week.

The Philippine Stock Exchange index (PSEi) declined by 33.79 points or 0.51% to close at 6,591.47 on Monday, while the broader all shares index dropped by 10.25 points or 0.29% to 3,516.67.

“The local market lost 33.79 points to 6,591.47 due to last-minute profit taking. The market mostly traded in the green territory on anticipation of a slower inflation in July at home but it failed to sustain the momentum due to negative sentiment overseas, especially in China, as China’s factory activity for July was in contraction territory,” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.

Selling pressure affected the market as investors adjusted their portfolios as July came to a close, China Bank Capital Corp. Managing Director Juan Paolo E. Colet said.

The Philippine Statistics Authority will release July consumer price index (CPI) data on Friday, August 4.

A BusinessWorld poll of 17 analysts yielded a median estimate of 4.9% for July inflation.

If realized, this would be below the 5.4% in June but would match the 4.9% seen in April last year.  However, this would mark the 16^th straight month that the CPI exceeded the central bank’s 2-4% target.

Meanwhile, China manufacturing activity fell for the fourth straight month in July as its services and construction edged along contraction, threatening growth prospects for the third quarter, Reuters reported.

The official manufacturing purchasing managers’ index inched up to 49.3 in July from 49 in June, staying below the 50-point mark that separates expansion from contraction.

At home, most sectoral indices fell on Monday except for services, which rose by 11.22 points or 0.7% to 1,613.19, and financials, which inched up by 0.54 point or 0.02% to 1,940.59.

Meanwhile, holding firms fell by 67.99 points or 1.06% to 6,328.99; mining and oil dropped by 50.9 points or 0.48% to 10,364.31; property declined by 12.63 points or 0.46% to 2,709.85; and industrials went down 29.59 points or 0.32% to 9,176.73.

Value turnover surged to PHP 20.07 billion on Monday with 1.95 billion shares changing hands from the PHP 2.91 billion with 635.55 million issues seen on Friday.

Decliners narrowly outnumbered advancers, 84 versus 83, while 64 names closed unchanged.

Meanwhile, Asian shares were trying to end the month on a firm note on Monday in a week littered with major economic releases, central bank meetings and earnings updates from mega-caps Amazon and Apple, Reuters reported.

MSCI’s broadest index of Asia-Pacific shares outside Japan climbed 0.5%, having gained 5.2% so far in July to reach a five-month high.

The initial impetus for markets was positive following Friday’s US data showing an easing in wage costs and core inflation, which fueled hopes the US Federal Reserve was done tightening. — A.H. Halili with Reuters