The local stock barometer inched up to the 6,800 level yesterday as a regional upswing prevailed over initial jitters about the higher-than-expected Philippine inflation data for November.
Reversing losses in early trade, the main-share Philippine Stock Exchange index (PSEi) gained 29.73 points or 0.44 percent to close at 6,806.14 on selective buying of large-cap stocks.
The day’s rebound was led by the property counter, which rose by 1.42 percent, while holding firms also gained. On the other hand, the financial, industrial, services and mining/oil counters all declined.
Luis Gerardo Limlingan, managing director at Regina Capital Development, said local shares were driven higher by the upbeat sentiment in the US that, in turn, spilled over the regional markets. All US stock indices came close to record high levels for the year as “the solid economic data clearly offset concerns about neighbor Europe’s stability—following the rejection vote of Italy to reform existing constitutional rules,” he said.
In addition, Limlingan noted that oil futures ended at a one-year high as the industry continued to wrestle with the details surrounding the Organization of Petroleum Exporting Countries’ (Opec) historic agreement to cut production.
“Locally, investors digested the latest inflation number, although a mild spike from analysts’ estimates, also indicated that consumer demand seems to be outweighing supply,” Limlingan said.
Japanese investment bank Nomura noted that at 2.5-percent year-on-year in November, the Philippine inflation rate had surprised on the upside. Consensus forecast was only 2.2 percent while the Bangko Sentral ng Pilipinas’ own forecast range was 1.6-2.4 percent.
The pick-up was driven mainly by utilities and transport while core inflation also edged higher, in part underscoring the continued strength of domestic demand, Nomura said.