Shares inch up regardless of upper inflation in Sept.

PHILIPPINE STOCKS eked out gains on Wednesday despite the release of data showing inflation reached a new peak last month.

The Philippine Stock Exchange index (PSEi) inched up by 0.87 point or 0.01% to close at 5,988.59 on Wednesday, while the broader all shares gained 9.50 points or 0.29% to end at 3,219.98.

Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message that the PSEi inched higher after the release of the latest consumer price index (CPI) data.

“Last month, the Philippines’ inflation rate reached 6.9%. Market gains were limited as this figure remains faster than August’s 6.3%,” Ms. Alviar said.

“Moreover, positive catalysts that could move the market were still lacking at the moment. The rally of the US markets overnight, somehow, helped boost the sentiment at home,” she added.

“The market bounced up after blood bath that saw stock prices at cheap valuations and extremely oversold technical levels. Driving the rebound has been the correction in the global bond markets.  However, the market’s momentum was dampened by the latest Philippine inflation data that saw it surge to 6.9%, the highest level since October 2018,” AB Capital Securities, Inc. Vice-President Jovis L. Vistan said in a Viber message.

Headline inflation picked up to its fastest pace in more than 13 years in September due to higher food costs, the Philippine Statistics Authority reported on Wednesday.

The consumer price index was at 6.9% in September, up from 6.3% in August and 4.2% in the same month last year. It matched the 6.9% print in October 2018 and was the fastest since the 7.2% pace logged in February 2009.

The September print fell within the 6.6-7.4% forecast given by the Bangko Sentral ng Pilipinas (BSP) for the month and marked the sixth straight month that inflation breached the central bank’s 2-4% target for the year.

For the nine-month period, headline inflation averaged 5.1%, faster than 4% last year but below the BSP’s 5.6% forecast for 2022.

The majority of sectoral indices ended higher on Wednesday except for property, which went down by 21.01 points or 0.81% to 2,552.51 and holding firms, which declined by 35.22 points or 0.6% to 5,785.22. 

Meanwhile, services went up by 19.78 points or 1.29% to 1,542.64; financials gained 14.68 points or 0.98% to end at 1,510.89; mining and oil climbed by 78.68 points or 0.73% to 10,778.07 and industrials rose by 20.09 points or 0.22% to 8,917.40.

Value turnover declined to P4.82 billion on Wednesday with 644.59 million shares changing hands from the P4.59 billion with 514.19 million issues traded on Tuesday.

Advancers outnumbered decliners, 105 versus 82 while 46 names closed unchanged.

Net foreign buying stood at P188.31 million on Wednesday, a reversal of the P96.45 million in net selling recorded on Tuesday.

AB Capital Securities’ Mr. Vistan placed the PSEi’s initial support at 5,700 and resistance at 6,150. — A.E.O. Jose

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