By Arra B. Francia, Senior Reporter
STOCKS climbed on Friday as inflation decelerated to its slowest level in almost two years in June.
The benchmark Philippine Stock Exchange index (PSEi) rose 0.65% or 53.02 points to close at 8,117.94 on Friday, snapping the market’s two-day decline. The broader all shares index likewise firmed up 0.27% or 13.69 points to 4,945.68.
“Investors took the latest inflation reading as a sign to buy into the market as the June reading came in better than most analysts expected,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.
The Philippine Statistics Authority reported Friday that inflation decelerated to 2.7% in June, lower than May’s 3.2% record and June 2018’s 5.2%. This is the slowest since the 2.6% seen in August 2017.
“Among the notable declines were in food (2.7%), transport (1.6%) and education (-4.5%). The favorable base effects also helped push inflation to its lowest in nearly two years,” Mr. Limlingan added.
Inflation averaged 3.4% for the first six months of the year, within the government’s 2-4% annual target.
“Suffice it to say the market was happy about June’s inflation figure of 2.7% (vs. expectations of 2.8%), as the index traded in the green the entire day. Unfortunately, the index still failed to breakout past the 8,139 resistance mark,” Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said in an email.
Four sectoral indices moved to positive territory, led by property which jumped 0.9% or 39.41 points to 4,379.75. Holding firms gained 0.76% or 59.20 points to 7,797.21; industrials went up 0.69% or 82.78 points to 11,988.32, while financials added 0.31% or 5.53 points to 1,742.01.
In contrast, mining and oil slumped 0.72% or 54.02 points to 7,439.29, while services declined 0.22% or 3.80 points to 1,699.04.
Some 759.24 million issues valued at P5.49 billion switched hands, slightly higher than the previous session’s P5.06 billion.
Despite the PSEi’s uptick, market breadth was negative with 116 decliners versus 80 advancers. Meanwhile, 53 names closed unchanged.
Foreign investors remained net sellers at P35.37 million, albeit lower than Thursday’s P216.68 million.
“Let’s hope the positive momentum continues on to next week with the PSEi making another run for its resistance mark,” Papa Securities’ Mr. Perez said.