Stocks go down on profit taking before US data

Philippine stocks ended lower on Tuesday as investors pocketed their gains following the market’s three-day climb and awaited the release of key US data that could affect the US Federal Reserve’s policy decision this month.

The bellwether Philippine Stock Exchange index (PSEi) went down by 0.17% or 11.20 points to close at 6,408.76, while the broader all shares index slipped by 0.07% or 2.75 points to finish at 3,638.38.

“The local market retreated ever so slightly after the three-day win streak, as investors await fresh leads,” AP Securities, Inc. said in a market note.

“The local market pulled back as investors took profits following three days of rallying. The market digested the Philippines’ October foreign direct investments (FDI) data, which posted a 40% decline in net inflows,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

FDI net inflows dropped by 39.8% to USD 642 million in October from USD 1.067 billion in the same month in 2024, the Bangko Sentral ng Pilipinas (BSP) reported late on Monday.

For the first 10 months, net inflows fell by 24.5% to USD 6.179 billion from USD 8.184 billion in the comparable year-ago period.

“Investors are also waiting for the US December consumer price index (CPI) data, which is expected to provide clues on the Federal Reserve’s policy outlook,” Mr. Tantiangco added.

US consumer prices likely accelerated in December as some of the distortions related to the government shutdown that had artificially lowered inflation in November unwound, which would cement expectations of the US Federal Reserve leaving interest rates unchanged this month, Reuters reported.

The CPI likely increased by 0.3% last month amid higher food and energy prices, mostly electricity because of data centers, a Reuters survey of economists predicted. In the 12 months through December, the CPI is forecast to have increased 2.7%, matching November’s gain.

The Fed tracks the Personal Consumption Expenditures Price indexes for its 2% inflation target. The US central bank is expected to keep its benchmark overnight interest rate in the 3.5%-3.75% range at its Jan. 27-28 meeting.

Back home, most sectoral indices closed lower on Tuesday. Industrials fell by 0.55% or 50.97 points to 9,088.80; property decreased by 0.44% or 10.44 points to 2,336.77; financials went down by 0.21% or 4.60 points to 2,174.57; and holding firms retreated by 0.16% or 8.51 points to 5,018.4.

Meanwhile, mining and oil jumped by 2.09% or 359.21 points to 17,475.64; and services increased by 0.47% or 12.26 points to 2,575.43.

Advancers outnumbered decliners, 104 to 94, while 70 names closed unchanged.

Value turnover rose to PHP 6.75 billion on Tuesday with 1.26 billion shares traded from the PHP 6.64 billion with 1.02 billion issues that changed hands on Monday.

Net foreign buying decreased to PHP 506.15 million from PHP 534.17 million. — Alexandria Grace C. Magno with Reuters