Bargain-hunting main index higher after 3-day slide

THE MAIN INDEX rose slowly on Thursday to end its three-day slide of bargain hunting and ahead of the release of local and US economic data.

The Philippine Stock Exchange (PSEI) benchmark index rose 4.63 points, or 0.07%, to close at 6,588.28 on Thursday. Meanwhile, the broader All-Shares Index declined 2.68 points, or 0.07%, to 3,498.04.

“Local stocks fell as renewed pressure on interest rates dampened investor appetite. On the local front, buying interest was dampened by concerns about the domestic marketbottleation,” said Jovis Vistan, vice president and head of research at AB Capital Securities, Inc., in a Viber message.

Mr. Vistan said inbottleation “probably won’t be on the lower end of the scale as we’re now seeing shortages of sugar, salt, garlic and other foods.”

“PSEi narrowly avoided a potential three-day bargain-hunting flight, but overall sentiment remains cautious as indicated by market breadth, where decliners outnumber risers,” said Carlos Angelo O. Temporal, equity research analyst at AP Securities Inc .in a Viber message.

On Thursday, the decliners outnumbered the climbers, 87 versus 96, while 46 names closed unchanged.

Mr Temporal said investors remain cautious ahead of the release of the latest US jobs report this Friday and the PSA’s Consumer Price Index (CPI) next week, as well as the peso’s continued decline.

The Bangko Sentral ng Pilipinas expects a headlinebottlenation settled between 5.9% and 6.7% in August as food prices continued to rise. If realized, it would exceed the central bank’s 2-4% target for the US dollar fififth month in a row.

The PSA will release the August CPI report on Tuesday, September 6th.

Meanwhile, the peso fell to 56.42 pesos to the dollar on Thursday, down 27.5 centavos from Wednesday fiEnd of P56.145.

This is the local unit’s worst finish in almost 18 years or since its course of 56.45 points fiEnd on October 14, 2004, the peso’s record low.

Most sector indices closed higher on Thursday except for real estate, which fell 62.45 points or 2.06% to 2,962.46; and Services, down 9.48 points, or 0.56%, to 1,667.47.

Meanwhile, holding companies climbed 70.75 points, or 1.14%, to 6,270.94; Mining & Oil rose 92.54 points, or 0.79%, to 11,724.12; Financials were up 8.69 points, or 0.54%, to 1,615.54; and Industrials added 19.50 points or 0.20% to close at 9,758.94.

Value turnover fell to P5 billion on Thursday, with 635.98 million shares changing hands, from P8.87 billion with 1.45 billion issues on Wednesday.

Foreigners turned to buyers again on Thursday with net purchases of P115.14 million from the previous day’s net sales of P287.46 million.

AB Capital Securities’ Mr. Vistan put PSEi’s support at 6,480 and resistance at the 6,650 level. — Justine Irish D. Tabile