PSEi plunges over 100 points, shrugging off inflation data

MANILA  -The Philippine benchmark index (PSEi) plunged over 100 points to close below 6,500 as investors brushed off new government data showing that domestic inflation cooled further to 4.7 percent in July.

The PSEi sank 1.91 percent, or 125.92 points, to 6,450.84 while the broader All Shares Index slumped 1.48 percent, or 51.88 points, to 3,447.61.

Data from the Philippine Statistics Authority showed inflation easing for a sixth straight month in July. The latest print of 4.7 percent was also fell within the Bangko Sentral ng Pilipinas’ target range of 4.1-.4.9 percent.

“We continue to expect a decline in inflation in the coming months in our base scenario. Assuming the absence of major supply shocks, headline inflation may finally return to the target of the BSP by September or October,” Bank of the Philippine Islands said on Friday, while warning of potential upside risks due to the El Niño weather phenomenon.

Luis Gerardo Limlingan, head of sales at stock brokerage house Regina Capital Development, said stocks were sold down partly due to the rebalancing of portfolios by major funds.

This follows the PSE’s announcement that its latest index rebalancing will be implemented on Aug. 7.

PSE data showed 540.9 million shares valued at P6.64 billion changing hands while net foreign selling reached P245.42 million.

Ayala Land Inc., the most actively traded stock, sank 1.9 percent to P28.40 per share.

BPI was up 3.08 percent to P117; SM Investments Corp., down 0.38 percent to P908.50; SM Prime Holdings Inc., up 2.87 percent to P34; and BDO Unibank Inc., down 3.82 percent to P141 per share. INQ