PSEi posts slight gains as market looks for leads

Philippine stocks edged up on Tuesday as the market mostly traded sideways before the release of inflation data on Friday.

The bellwether Philippine Stock Exchange index (PSEi) rose by 0.08% or 5.11 points to close at 5,994.40, while the broader all shares index decreased by 1.92% or 68.28 points to end at 3,475.50.

“The local bourse closed slightly higher as sentiment improved after the PPI (producer price index) came in better than expected, helping ease concerns over rising cost pressures,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

The PPI for manufacturing went up by 0.3% year on year in October, slowing from the 0.8% increase recorded in September, data from the Philippine Statistics Authority showed. This was a turnaround from the 0.4% annual decline recorded in the same month last year.

“Overall trading remained measured ahead of this week’s inflation data and the Fed’s policy decision next week, with investors waiting for clearer macro signals,” Mr. Limlingan added.

November inflation data will be released on Friday (Dec. 5). A BusinessWorld poll of 15 analysts yielded a median estimate of 1.6% for the November consumer price index (CPI), within the Bangko Sentral ng Pilipinas’ (BSP) 1.1-1.9% forecast.

If realized, headline inflation would ease from the 1.7% clip in October and the 2.5% logged in the same month a year ago. This would also be the slowest CPI in three months or since the 1.5% seen in August and mark the ninth straight month that inflation fell below the central bank’s 2-4% annual target.

Meanwhile, the US Federal Reserve will hold its policy review on Dec. 9-10, where markets widely expect another rate cut. However, investors will monitor its statement for hints on its policy direction moving forward as the US economic picture remains mixed.

“Our proxy for global trade (ICT) and the leading defensive play in the market (MER) barely raised the local index to positive territory, despite the multitude of unfavorable economic developments today,” AP Securities, Inc. said in a market note, referring to the ticker symbols of International Container Terminal Services, Inc. and Manila Electric Co., respectively.

Most sectoral indices declined on Tuesday. Mining and oil sank by 1.44% or 202.41 points to 13,851.41; financials decreased by 0.96% or 19.19 points to 1,979.61; holding firms went down by 0.51% or 24.60 points to 4,740.13; and industrials slipped by 0.02% or 1.85 points to 8,621.86. Meanwhile, services jumped by 1.95% or 46.59 points to 2,435.79, and property edged up by 0.02% or 0.48 point to 2,202.48.

Advancers narrowly beat decliners, 97 to 95, while 59 names closed unchanged.

Value turnover went down to PHP 5.49 billion on Tuesday with 1.13 billion shares traded from the PHP 6.48 billion with 1.14 billion issues exchanged on Monday.

Net foreign selling decreased to PHP 179.48 million from PHP 1.87 billion. — A.G.C. Magno