Shares end higher in thin trade on inflation bets

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SHARES FIRMED up on the first trading day of the year amid thin volume, as investors looked ahead to the release of likely slower inflation data for December.

The 30-member Philippine Stock Exchange Index (PSEi) gained 0.31% or 23.18 points to end at 7,489.20 on Wednesday. The broader all-shares index also went up 0.06% or 2.82 points to 4,520.67.

“It was sort of a good start for the year since we ended up. If you look at the turnover value, we were only at P3.2 billion, but still we ended on the positive side,” A&A Securities, Inc. trader Jeng T. Calma said in Filipino during a phone interview.

“Hopefully the index can sustain this trend in the coming days. It was able to touch the 7,500 mark earlier [on Wednesday], so hopefully we can achieve that level given that inflation is seen to have slowed down in December.”

The PSEi hit a high of 7,540.26 intraday, but failed to sustain this until closing bell.

Philstocks Financial, Inc. Research Associate Japhet Louis O. Tantiangco also attributed the PSEi’s rally to expectations of a slower headline inflation print for December, adding that the thin trading was due to investor caution over global events.

“Value traded was lethargic at just P3.356 billion as many chose to stay on the sidelines, in lieu of global concerns, particularly the fears of a global economic slowdown to subside first,” Mr. Tantiangco said via text.

A BusinessWorld poll of seven analysts yielded a median inflation estimate of 5.7% for December. This falls within the Bangko Sentral ng Pilipinas’ estimate range of 5.2-6% announced last week. If realized, this would be the slower than November’s six percent record.

Sectoral indices were equally split between gainers and losers. Property led advancers, jumping 2.37% or 86.08 points to 3,714.06, followed by mining and oil which climbed 1.78% or 145.93 points to 8,346.43. Services also went up 0.53% or 7.75 points to 1,450.46.

Meanwhile, financials fell 0.65% or 11.60 points to 1,768.25; holding firms dropped 0.32% or 23.92 points to 7,317.89; while industrials slipped 0.08% or 9.40 points to end at 10,941.96.

Some 717.58 million issues switched hands, resulting in a value turnover of P3.36 billion, lower than the previous session’s P5.67 billion.

Net foreign outflows also slimmed to P4.58 million yesterday from the P198 million posted on Dec. 28.

Advancers outpaced decliners, 96 to 85, while 44 names remained unchanged.

Meanwhile, markets in the United States rallied on the last trading day of 2018, with the Dow Jones Industrial Average rising 1.15% or 265.06 points to 23,327.46. The S&P 500 index climbed 0.85% or 21.11 points to 2,506.85, while the Nasdaq Composite index also picked up 0.77% or 50.76 points to 6,635.28.

Despite the uptick last Dec. 28, all three US indices went down on an annual basis at 5.63%, 6.24%, and 3.88%, respectively. — Arra B. Francia