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PSEi returns to 8,000 level ahead of GDP report

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THE local barometer climbed back to the 8,000 level on Tuesday, as the market regained composure following easing tensions between North Korea and the US, complemented by optimism on Philippine economic growth for the second quarter.

The 30-member Philippine Stock Exchange index (PSEi)inched up by 0.59% or 47.29 points to end at 8,009.41 yesterday. The all-shares index also climbed 0.5% or 23.69 points to 4,729.73.

“The market stayed upward today, closing above 8,000, [due to] positioning in anticipation of good GDP (gross domestic product) figures to be reported on Thursday. Investors also cheered the reduction of tensions between North Korea and the US,” PNB Securities, Inc. President Manuel Antonio G. Lisbona said in a text message on Tuesday.

Regina Capital Development Corp. Managing Director Luis A. Limlingan was of the same mind, noting that Philippine stocks, while “not out of the woods,” continued their uptrend amid easing geopolitical concerns.

US stocks recovered further on Monday from last week’s sell-off, with the S&P 500 posting its biggest one-day percentage gain since April as worries eased about a conflict between the United States and North Korea.

US officials on Sunday played down the risk of an imminent war with North Korea. Those concerns had helped wipe out nearly $1 trillion from global equity markets last week.

The Dow Jones Industrial Average rose 135.39 points or 0.62% to close at 21,993.71, while the S&P 500 gained 24.52 points or 1% to 2,465.84. The Nasdaq Composite added 83.68 points or 1.34% to 6,340.23.

Analysts said investors are awaiting tomorrow’s release of official second-quarter GDP data by the Philippine Statistics Authority.

“With earnings season coming to an end, GDP on Thursday could make or break the index prior to official start of ‘ghost month,’” Mr. Limlingan said.

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The mining and oil sector was the lone counter in the red yesterday, dropping 0.07% or 9.49 points to 12,577.88.

The industrials counter led gainers with an increase of 1.2% or 130.18 points to 10,959.57, followed by holding firms, which added 42.26 points or 0.53% to 7,883.06. Services rose 0.4% or 6.81 points to 1,696.7, financials added 0.36% or 7.21 points to 1,996.78, and property gained 0.35% or 13.42 points to end at 3,781.31.

A total of 938.03 million issues changed hands for a value turnover of P4.79 billion, lower than Monday’s P5.11 billion. “[Tuesday’s] relatively thin value turnover indicates slowing investor participation… We may see some profit taking in the next few days as the market nears resistance,” PNB Securities’ Mr. Lisbona said.

Advancers outpaced decliners, 121 to 82, while 44 issues were unchanged.

Net foreign buying thinned to P197.52 million yesterday from the P265.61 million recorded on Monday. — A.B. Francia with Reuters





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