Continued buying on strong third-quarter GDP numbers keeps PSEi above 7,000
The local stock barometer stayed above 7,000 Friday on follow-through buying arising from fresh optimism on the fast-growing Philippine economy.
Amid mixed regional markets, the Philippine Stock Exchange index (PSEi) gained 17.61 points or 0.25 percent to close at 7,067.73.
For the week, the PSEi regained 1.3 percent on expectations of strong economic growth despite the fiscal slowdown in the third quarter. On Thursday, it was reported that third-quarter gross domestic product (GDP) had expanded by 7.1 percent, beating the consensus forecast of 6.7 percent.
“It’s a spillover from better-than-expected GDP numbers. And if you look at it, this was notwithstanding underspending by the government. So investors are anticipating even better numbers next year, which is why they are buying issues that are seen to benefit from massive infrastructure development,” said Manny Cruz, chief strategist at Asiasec Equities.
The third-quarter performance brought the nine-month growth rate to 7 percent, prompting growth outlook upgrades from various financial institutions.
On Thursday, US Federal Reserve Chair Janet Yellen hinted that the next increase in US interest rates would come soon. However, optimism over Philippine growth prospects offset US interest rate jitters.
The local market was led higher by the mining/oil counter, which gained 2.8 percent, while the industrial, holding firm and services counters added modest gains.
The financial and property counters, on the other hand, were slightly lower as investors anticipated an increase in interest rates.
Value turnover for the day amounted to P5.96 billion. There were 90 advancers that beat 81 decliners while 50 stocks were unchanged.
Coal mining firm Semirara (+6.37 percent) and its parent conglomerate DMCI (+3.08 percent) were the days’ biggest gainers.
Asiasec’s Cruz said Semirara’s gain could be due to the mining firm’s hurdling of environmental compliance requirements while DMCI had been attracting fund managers on expectations that it would benefit from large infrastructure projects planned under the Duterte administration.
DMCI’s construction arm D.M. Consunji Inc. announced that it was in discussions with a number of possible technology partners from Asia, Europe and the Middle East to complement the group’s construction expertise.
DMCI is also looking for strategic partners that can add value in terms of efficiency, cost design and methodology.
