Philippine stocks falter on disappointing Q3 growth

MANILA, Philippines—Most local stocks faltered on Monday as a weaker-than-expected third quarter local economic growth added to investors’ external jitters as the main index struggled to keep slim gains for this year.

The main-share Philippine Stock Exchange index shed 33.71 points or 0.79 percent to finish at 4,227.88. The main index is thus now barely higher than the end-2010 level of around 4,200.

A slower-than-expected third quarter growth in Philippines gross domestic product for the third quarter – 3.2 percent versus the consensus forecast of a little over 4 percent – dampened sentiment for the day.

“It was a negative surprise as investors were selling on the bad numbers and reducing exposure on some growth stocks,” said fund manager Paul Joseph Garcia, senior vice president at Bank of the Philippine Islands.

Asiasec Equities chief strategist Manny Cruz agreed that the disappointing third quarter growth had spooked local equities. “The region was mostly up sharply due to strong US market futures.”

As of the local market’s closing on Monday, the Dow Jones futures index was up by about 159 points.

The local market’s decline was led by the industrial and holding firm counters which respectively dipped by 1.31 percent and 1.26 percent. Only the property counter ended with modest gains.

Value turnover amounted to P4.7 billion. There were 59 advancers which were edged out by 77 decliners while 55 stocks were unchanged.

SMC, SM Investments, URC, Metrobank, PLDT, Megaworld, BDO, Metro Pacific, AGI, Aboitiz Power and Ayala Corp. weighed down most on the PSEi. RCBC was likewise in the red.

On the other hand, the gains eked out by BPI, EDC and ALI pared down the day’s losses. Other stocks like Highlands Prime and Nihao also traded higher in heavy trade.