PSEi inches up as investors await US CPI report

The main index inched higher on Monday in thin trade as investors awaited the release of June US consumer inflation data, which could affect the US Federal Reserve’s policy decision this month, and due to deflation risks in China.

The Philippine Stock Exchange index (PSEi) inched up by 0.69 points or 0.01% to 6,379.72 on Monday, while the broader all shares index slipped by 3.28 points or 0.09% to 3,419.

“The market was barely up on very low value turnover as investors remained cautious ahead of the US June inflation print. The index initially traded above 6,400 early in the day before succumbing to selling pressure that kept market in the vicinity of 6,380 for most of the session,” China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.

Mr. Colet said investors also reacted to weak Chinese consumer and producer inflation data.

“The local bourse ended nearly unchanged as the market remains wary following the drop last week owing to rising US Fed rate concerns. Investors are staying on the sidelines as they await the release of US CPI (consumer price index) report this Wednesday, which can provide some clues on the trajectory of the Fed. The muted sentiment was further weighed down by emerging China’s deflation risks after its CPI figure ended surprisingly lower than expectations,” Unicapital Securities, Inc. Senior Equity Research Analyst Carlos Angelo O. Temporal likewise said in a Viber message.

Value turnover fell to PHP 2.82 billion on Monday with 332.82 million shares changing hands from the PHP 3.1 billion with 444.77 million issues seen on Friday.

In May, the US CPI edged up 0.1% after rising 0.4% in April. In the 12 months through May, the CPI climbed 4%.

The Fed last month paused its tightening cycle after hiking rates for 10 straight meetings by a total of 500 basis points, bringing its target interest rate to a range between 5% and 5.25%.

Meanwhile, data out on Monday showed that China’s factory-gate prices fell at the fastest pace in seven-and-a-half years in June and consumer inflation was at its slowest since 2021, fueling hopes for further support measures from Chinese authorities, Reuters reported.

China’s consumer prices remained unchanged year on year compared with the 0.2% gain seen in May, while the producer price index fell for a ninth consecutive month in June, down 5.4% from a year earlier.

At home, sectoral indices were split on Monday. Financials rose by 9.02 points or 0.49% to 1,826.18; property climbed by 8.03 points or 0.31% to 2,555.73; services went up by 3.39 points or 0.21% to 1,554.96.

Meanwhile, holding firms fell by 29.87 points or 0.47% to 6,296.21; mining and oil shed 44.69 points or 0.45% to end at 9,825.87; and industrials lost by 18.84 points or 0.2% to close at 9,095.79.

Decliners outnumbered advancers, 108 versus 72, while 48 names closed unchanged.

Net foreign selling declined to PHP 250.32 million on Monday from PHP 494.97 million on Friday. — A.H. Halili with Reuters