PSEi sinks to 5,800 level before inflation report

The main index on Thursday returned to the 5,800 level for the first time in two weeks as cautious sentiment reigned before the release of the latest Philippine inflation data that could influence the Bangko Sentral ng Pilipinas’ (BSP) policy decision next week.

The bellwether Philippine Stock Exchange index (PSEi) fell by 0.3% or 18.26 points to close at 5,887.58, while the broader all shares index decreased by 0.17% or 6.14 points to end at 3,458.65.

This was the PSEi’s lowest close in over two weeks or since it finished at 5,813.71 on Nov. 19.

“The local bourse closed lower as investors stayed cautious ahead of tomorrow’s inflation release. Market participants remained on the sidelines while awaiting clearer economic signals. Additionally, the continued depreciation of the peso weighed on overall sentiment,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“GDP (gross domestic product) growth forecast [downgrades] from key agencies … spooked investors, fueling a profit taking session ahead of the inflation print announcement tomorrow,” AP Securities, Inc. said in a note.

The Philippine Statistics Authority is scheduled to release November inflation data on Friday (Dec. 5). A BusinessWorld poll of 15 analysts yielded a median estimate of 1.6% for the consumer price index, within the Bangko Sentral ng Pilipinas’ (BSP) 1.1-1.9% forecast for the month.

If realized, last month’s inflation print would ease from the 1.7% clip in October and the 2.5% recorded a year earlier.

BSP Governor Eli M. Remolona, Jr. said on Wednesday that GDP growth could settle between 4% and 5% by yearend, below the government’s 5.5-6.5% goal, which would raise the possibility of a fifth straight rate cut at the Monetary Board’s Dec. 11 policy meeting.

In October, the BSP delivered a surprise cut, with officials saying there is a need for a more accommodative stance to support the economy as a corruption scandal involving anomalous government flood-control projects has dampened prospects. It has lowered benchmark borrowing costs by 175 basis points since it began its easing cycle in August 2024, with the policy rate now at 4.75%.

Most sectoral indices ended lower on Thursday. Industrials dropped by 0.6% or 51.22 points to 8,480.74; holding firms decreased by 0.54% or 25.53 points to 4,672.11; financials went down by 0.47% or 9.34 points to 1,947.2; and property slipped by 0.3% or 6.73 points to 2,184.56.

Meanwhile, mining and oil rose by 1.48% or 206.73 points to 14,105.72, and services went up by 0.44% or 10.45 points to 2,382.63.

Decliners outnumbered advancers, 100 to 81, while 71 names were unchanged.

Value turnover went down to PHP 6.54 billion on Thursday with 843.91 million shares traded from the PHP 6.87 billion with 889.92 million issues exchanged on Wednesday.

Net foreign selling decreased to PHP 967.02 million from PHP 1.25 billion. — A.G.C. Magno