Stocks climb on expectations of slower inflation

PHILIPPINE SHARES extended their climb on Monday on expectations of slower headline inflation in December and as bargain hunting continued.

The Philippine Stock Exchange index (PSEi) went up by 0.48% or 29.47 points to end at 6,164.53, while the broader all shares index increased by 1.04% or 36.69 points to 3,553.74.

“The local market rose as investors continued with their bargain hunting. Expectations that inflation remained benign last December helped in Monday’s climb,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

The Philippine Statistics Authority will release December inflation data on Tuesday (Jan. 6).

A BusinessWorld poll of 14 analysts yielded a median estimate of 1.4% for December headline inflation, within the Bangko Sentral ng Pilipinas’ (BSP) 1.2%-2% forecast.

This is slower than the 1.5% print in November and 2.9% in the same month in 2024. It would also mark the 10^th straight month that the headline figure was below the central bank’s 2%-4% annual target.

“The local bourse traded at the highs before bagging a decent gain last minute as investors picked up quality issues after the strong December rebound in factory activity that saw a 50.2 print, driven by the rise in order volumes,” AP Securities, Inc. said in a market note.

The PSEi opened Monday’s session lower than Friday’s close at 6,115.79, which was its intraday trough. Meanwhile, it returned to the 6,200 level for the first time since September, reaching an intraday high of 6,237.14.

The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) expanded to 50.2 in December, a turnaround from November’s 47.4 which was the “strongest deterioration” in over four years, data released on Friday showed.

December saw the highest PMI in four months or since the 50.8 reading in August.

Most sectoral indices closed higher on Monday. Mining and oil rose by 2.95% or 458.04 points to 15,980.86; services increased by 1.58% or 37.35 points to 2,391.88; industrials went up by 0.71% or 62.50 points to 8,835.56; and financials climbed by 0.5% or 10.62 points to 2,106.21.

Meanwhile, holding firms dropped by 0.28% or 14.17 points to 4,884.43, and property went down by 0.11% or 2.60 points to 2,306.24.

Advancers outnumbered decliners, 133 to 93, while 51 names closed Monday’s session unchanged.

“ACEN Corp. was the day’s top index gainer, jumping 5.5% to P3.07. Converge ICT Solutions, Inc. was the main index laggard, falling 4.65% to P14.76,” Mr. Tantiangco said.

Value turnover went up to P5.74 billion on Monday with 948.53 million shares traded from the P4.36 billion with 444.17 million issues dealt on Friday.

Net foreign buying went down to P330.78 million from P427.27 million. — A.G.C. Magno