LOCAL SHARES continued their recovery on Thursday on the back of slower Philippine inflation and positive developments in Hong Kong and the US-China trade war.
The Philippine Stock Exchange index (PSEi) went up 57.33 points or 0.73% to close at 7,898.19 yesterday. The broader all-shares index was also up 20.51 points or 0.43% to reach 4,774.28
AAA Southeast Equities, Inc. Research Head Christopher John Mangun said investors were upbeat following the Philippine Statistics Authority’s release of August inflation data yesterday.
Headline inflation slowed to 1.7% last month from July’s 2.4%, falling within the Bangko Sentral ng Pilipinas’ (BSP) 1.3%-2.1% estimate range for the month .
Year-to-date, inflation is at 3%, well within the BSP’s 2-4% target range for the year but still above the central bank’s 2.6% forecast.
Mr. Mangun also attributed the performance of the index on Thursday to positive developments in Hong Kong and in the US-China trade war.
“It was a good day for global equities as most markets ended higher today including here at the PSE. This came as the Hong Kong government withdrew its controversial proposal to extradite people to mainland China. It also helped that the US and China have agreed to meet next month.”
“If this continues tomorrow, we may see it go above the key 8,000 level. The other alternative is it ends the week flat. We do not see anything particularly negative as of the moment,” Mr. Mangun said on Thursday.
China and the United States agreed to hold high-level trade talks in early October in Washington, China’s commerce ministry said on Thursday, amid fears that an escalating trade war could trigger a global economic recession.
Meanwhile, Hong Kong leader Carrie Lam on Wednesday withdrew an extradition bill that triggered months of often violent protests.
Papa Securities Corp. Sales Associate Gabriel Jose F. Perez shared the same sentiment, adding that the decision of President Rodrigo R. Duterte to allow the operations of online gaming companies in the Philippines to continue, as well as plans of Metro Pacific Hospital Holdings, Inc. for an P83.3-billion maiden share sale buoyed the day’s trading.
All counters ended in the green except the mining and oil sub-sector, which declined 3.66% or 356.50 points to end at 9,377.37.
Meanwhile, property went up 0.96% or 38.10 points to end at 3,989.42; services climbed 0.83% or 12.99 points to 1,576.68; holding firms gained 0.81% or 63.99 points to 7,904.93; financials added 0.58% or 10.56 points to 1,815.71; and industrials rose 0.18 or 20.17 points to close at 10,893.05.
Some 869.68 million issues valued at P7.11 billion switched hands on Thursday, higher than previous session’s P6.59 billion.
Advancers outnumbered losers, 113 to 77, while 53 names closed unchanged.
Foreigners remained as sellers, with net outflows totaling P672.43 million, down from previous session’s P743.70 million. — Vincent Mariel P. Galang with Reuters