STOCKS continued to rally on Thursday as December inflation came in below market expectations despite picking up from the November level.
The 30-member Philippine Stock Exchange index (PSEi) went up by 42.83 points or 0.63% to close at 6,761.33 on Thursday, while the broader all shares index added 13.38 points or 0.37% to end at 3,550.45.
“The local market extended its gains… as the December Philippine inflation rate came in slower than the midpoint of the BSP’s (Bangko Sentral ng Pilipinas) forecast range,” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.
Headline inflation picked up to 8.1% in December, a new 14-year high, amid higher food prices, the Philippine Statistics Authority reported on Thursday.
Last month’s inflation print was the fastest since the 9.1% recorded in November 2008. It was also quicker than the 8% in November and 3.1% in December 2021.
Still, this was closer to the lower end of the 7.8-8.6% estimate given by the BSP for the month and was also below the 8.3% median estimate in a BusinessWorld poll of 11 analysts conducted last week.
Inflation averaged 5.8% in 2022, matching the BSP’s full-year forecast but exceeding its 2-4% target.
“Moreover, Asian markets were also in the green as China’s Caixin services data show an improvement, shrugging off the Federal Reserve’s minutes that show higher interest rates may remain. This also gives a boost to the local market,” Ms. Alviar added.
Mercantile Securities Corp. Head Trader Jeff Radley C. See said in a Viber message that the market continued to rally as trading volume was above average.
“We think that the market needs a pullback before it can go beyond its resistance area between 6,818 and 6,880. Investors are looking forward to its recovery this 2023 but stay cautious as recession fears is still looming,” Mr. See added.
Value turnover climbed to PHP 6.89 billion on Thursday with 1.85 billion shares changing hands from the PHP 6.7 billion with 1.38 billion issues traded on Wednesday.
Most sectoral indices closed higher on Thursday except for mining and oil, which declined by 94.49 points or 0.82% to 11,427.66, and services, which slipped by 0.05 point to 1,684.55.
Meanwhile, financials went up by 34.26 points or 2.06% to 1,696.82; industrials rose by 64.74 points or 0.66% to 9,740.15; holding firms increased by 32.07 points or 0.49% to 6,572.97; and property added 1.81 points or 0.06% to end at 3,001.37.
Advancers outnumbered decliners, 93 versus 84, while 53 names closed unchanged.
Net foreign buying went up to PHP 907.86 million from PHP 333.74 million the previous day.
Philstocks Financial’s Ms. Alviar placed the PSEi’s support at 6,600 and resistance at 6,800. — Justine Irish D. Tabile
This article originally appeared on bworldonline.com