SHARES FELL on Monday as investors resorted to profit taking ahead of the release of inflation data on Tuesday.
The bellwether Philippine Stock Exchange index (PSEi)dropped 0.66% or 50.65 points to close at 7,579.61 Monday, June 4.
The broader all-shares index also shed 0.50% or 23.54 points to end at 4,615.18.
“Philippine investors saw this as an opportunity to take profits after Friday’s meteoric rise. This comes ahead of the inflation data which may even be the highest year-to-date, when it is released tomorrow morning,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile message on Monday.
The Philippine Statistics Authority will release official inflation data Tuesday, June 5.
In a BusinessWorld poll of 10 analysts, inflation was projected to reach a median estimate of 4.9% in May, which could be the fastest in at least five years.
The median falls within the 4.6%-5.4% range given by the Bangko Sentral ng Pilipinas and also matches the estimate given by the Department of Finance for this month. However, this is well beyond the government’s 2-4% target for the year.
Analysts blamed higher oil and food prices for the likely all-time high inflation print.
“Expectations are for May’s figure to even be higher than April’s 4.5% (using 2012 prices)… This will give a signal if the Monetary Board will hike rates once again in their next meeting on June 21,” Papa Securities Corp. trader Gabriel F. Perez said in an e-mail.
The main index was unaffected by the rally seen in Wall Street last Friday, where the Dow Jones Industrial Average jumped 0.90% or 219.37 points to 24,635.21, while the S&P 500 index surged 1.08% or 29.35 points to 2,734.62. The Nasdaq Composite index also picked up 1.51% or 112.21 points to 7,554.33.
Asian indices, meanwhile, tracked the positive sentiment seen in US counterparts last week due to higher-than-expected jobs report. Investors have also started to shrug off concerns on the US-China trade war.
Back home, sectoral indices were split between gainers and losers. The industrials sub-index led decliners with a loss of 1.8% or 196.34 points to 10,657.83, followed by holding firms which gave up 1.13% or 85.73 points to 7,477.87. Financials went down 0.92% or 17.49 points to 1,872.27.
On the other hand, the mining and oil counter went up by 1% or 99.72 points to 10,041.19. Property rose 0.57% or 21.63 points to 3,799.81, while services climbed 0.50% or 7.48 points to 1,479.24.
Some 464.51 million issues switched hands, resulting in a turnover of P5.48 billion, lower than the P5.56 billion recorded last Friday.
Decliners outpaced advancers, 113 to 72, while 58 names ended flat.
Foreign selling persisted for the 14th consecutive day, with net outflows reaching P240.53 million on Monday, albeit lower than the previous session’s P303.85 million. — Arra B. Francia