Stocks climb as World Bank keeps GDP forecasts
STOCKS ended higher on Thursday after the World Bank said it is optimistic on the Philippine economy this year, even as inflation and new variants of the coronavirus disease 2019 (COVID-19) threaten the outlook.
The 30-member Philippine Stock Exchange index (PSEi) advanced 92.62 points or 1.28% on Thursday to close at 7,307.75, while the broader all shares index went up 40.20 points or 1.05% to 3,870.11.
“The local bourse finished higher as investors seem to have taken positively the World Bank’s outlook for the Philippine economy,” Timson Securities, Inc. Trader Darren Blaine T. Pangan said in a Viber message.
In its latest “Global Economic Prospects” report released on Tuesday, the World Bank said the Philippines could go back to its pre-pandemic output this year, but the rapid spread of the Omicron variant may coincide with the threat of inflation, growing debt, and heightened income inequality in emerging and developing economies.
The multilateral lender kept its growth projection for the Philippine economy at 5.9% for 2022 and 5.7% for 2023. These are below the 7-9% and 6-7% growth projections set by economic managers for both years.
The World Bank expects the Philippine gross domestic product (GDP) to have expanded by 5.3% in 2021, which is within the 5-5.5% target of the government.
“Investors continued to bet on the recovery of the Philippines as the high US consumer price index (CPI) numbers made them return back to the PSEi,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
The consumer price index rose 0.5% last month after advancing 0.8% in November. In the 12 months through December, the CPI surged 7.0%, Reuters reported. That was the biggest year-on-year increase since June 1982 and followed a 6.8% rise in November.
Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said the local bourse’s extended rally on Thursday reflected investors’ hope that the National Capital Region will not be placed under a stricter lockdown.
The Health department on Thursday reported 34,021 new COVID-19 cases, bringing active infections in the country to 237,287.
All sectoral indices ended in the green on Thursday, led by mining and oil, which climbed 221.37 points or 2.24% to 10,082.12.
Financials gained 28.80 points or 1.74% to end at 1,678.44; services inched up 30.54 points or 1.55% to 1,994.86; industrials advanced 141.35 points or 1.37% to 10,402.87; holding firms added 65.61 points or 0.93% to close at 7,091.31; and property increased 19.10 points or 0.59% to 3,234.07.
Value turnover grew to P7.2 billion with 1.50 million shares switching hands from the P5.95 billion with 854.66 million issues traded the previous day.
Advancers outnumbered decliners, 131 against 60, while 50 names closed unchanged.
Net foreign buying increased to P659.73 million from the P313.75 million logged on Wednesday. — MCL with Reuters
