LOCAL STOCKS declined further on Monday on profit-taking ahead of the release of November inflation data.
The 30-member Philippine Stock Exchange index (PSEi) lost 47.52 points or 0.73% to close at 6,442.13 on Monday, while the broader all shares index decreased by 15.72 points or 0.46% to 3,403.93.
“Local stocks continued to falter amid persisting selling flows from foreign funds,” Papa Securities, Inc. Equities Strategist Manny P. Cruz said in a Viber message.
“Investors stayed apprehensive ahead of the release of the local inflation report on Tuesday, which is estimated to surpass the October print of 7.7%,” he added.
Inflation likely quickened beyond the Bangko Sentral ng Pilipinas’ (BSP) target for an eighth straight month in November, mainly due to costlier food items and higher electricity rates, analysts said.
A BusinessWorld poll of 15 analysts last week yielded a median estimate of 7.8% for the consumer price index in November, faster than the 3.7% print a year earlier and the 7.7% print in October.
If realized, November would be the eighth month in a row that inflation surpassed the BSP’s 2-4% annual target, and would be the fastest in 14 years or since the 9.1% print in November 2008.
“Last-minute profit taking pulled the market down… The local bourse was trading in the green earlier in the session as investors cheered the easing of COVID-19 (coronavirus disease 2019) restrictions in China but it gave up gains at the last minute amid worries over the Philippine inflation rate that will be released this week,” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.
Chinese cities including Urumqi announced an easing of coronavirus curbs on Sunday as China tries to make its zero-COVID policy more targeted, Reuters reported.
Steps to ease restrictions have varied across the country, with Zhengzhou, Shanghai and Nanning removing the requirement of showing test results to visit public areas or to take public transport.
Back home, the majority of the sectoral indices closed lower on Monday. Services declined by 31.25 points or 1.85% to 1,656.21; mining and oil lost 127.36 points or 1.22% to close at 10,275.91; holding firms decreased by 72.44 points or 1.15% to 6,181.26; and financials fell by 11.76 points or 0.71% to end at 1,624.86.
Meanwhile, property added 10.74 points or 0.38% to close at 2,836.09 and industrials increased by 47.94 points or 0.51% to 9,360.04.
Value turnover declined to P5.64 billion on Monday with 514.23 million shares changing hands from the P6.32 billion with 874.3 million issues traded on Friday.
Decliners outnumbered advancers, 105 versus 83, while 54 names closed unchanged.
Net foreign selling declined to P687.43 million on Monday from P846.26 million the previous trading day.
Philstocks Financial’s Ms. Alviar placed the PSEi’s support at 6,400 and immediate resistance at 6,600. — J.I.D. Tabile