Local stocks recover lost ground, climb back to 7,000 level

The local stock barometer climbed back to the 7,000 mark on Thursday, outperforming regional markets, as investors cheered the stronger-than-expected 7.1-percent third quarter Philippine economic growth report.

The main-share Philippine Stock Exchange index gained 83.84 points or 1.2 percent to close at 7,050.12.  It was the biggest gainer among regional stock indices, which ended with mixed results for the day.

At the local market, all counters were up but the day’s strongest performer was the property sub-index which gained 2.02 percent. The industrial counter, on the other hand, rose 1.42 percent.

Value turnover for the day amounted to P8.14 billion.  Foreign investors were net buyers, albeit still at a modest amount of P63 million.

Market breadth turned positive, with 91 advancers beating 78 decliners while 53 stocks were unchanged.

Following reports of the third-quarter economic growth, a number of financial institutions have upgraded growth forecasts for the Philippines.  Consensus growth forecast for the period was only at 6.7 percent.

“The 7.1 percent year-on-year expansion in third quarter is Asia’s strongest third quarter print to-date, and points to the resilience of the Philippine economy in a soft global growth environment,” said HSBC economist Joseph Incalcaterra.

“The structure of growth is largely unchanged from previous quarters: fixed capital investment grew 23 percent year-on-year, resulting in a 5.5 percentage point contribution to headline growth, mostly on the back of durable goods and construction. Meanwhile, private consumption growth of 7.3 percent year-on-year contributed 5 percentage points due to higher remittance inflows and growth in domestic employment,” he added.

The PSEi was led higher by URC, which gained 4.37 percent while conglomerate Ayala Corp. rose by 3.77 percent.

SM Prime, ALI and PLDT all advanced by over 2 percent while Metrobank, Jollibee, MPI, BPI and ICTSI all gained over 1 percent. SMIC and AEV also contributed modest gains.

Outside of the PSEi, notable gainers included retailer Puregold (+1.92 percent).