Expectations of mild inflation stabilize stocks

The possibility of a slowdown in inflation in August cheered investors on the first trading day of the month, with the stock market index surpassing 6,900 points.

At the end of Monday’s session, which was also the last day of the “ghost month”, the Philippine Stock Exchange Index (PSEi) was up 0.38 percent or 25.87 points to 6,923.41.

READ: Analysts’ consensus: inflation will probably decline in August

Meanwhile, the broader All Shares index rose 0.23 percent, or 8.6 points, to close at 3,751.41.

According to stock exchange data, foreigners made net purchases of 555.41 million shares worth PHP 4.89 billion, for a total of PHP 419.29 million.

Back to target range

The market gain was mainly on expectations that inflation in August would be lower than the 4.4 percent recorded in July, said Japhet Tantiangco, research manager at Philstocks Financial Inc.

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The Banko Sentral ng Pilipinas forecast inflation stabilized at between 3.2 percent and 4 percent last month due to greater availability of goods.

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Conglomerates led gains of 1.27 percent, with Sy-led SM Investments Corp. (SMIC) and Zobel family-run Ayala Corp. ending the session higher.

READ: BSP: Inflation could have slowed down in August

International Container Terminal Services Inc. was the top-traded stock, gaining 2.22 percent to PHP405 per share.

Next in line were SMIC, up 1.19 percent to PHP 895.50; Ayala Corp., up 2.15 percent to PHP 618; Ayala Land Inc., down 1.27 percent to PHP 34.85; and BDO Unibank Inc., flat at PHP 152.80.

Other actively traded stocks included: Jollibee Foods Corp., up 0.08 percent to PHP260; Universal Robina Corp., up 0.11 percent to PHP91.10; SM Prime Holdings Inc., down 1.45 percent to PHP30.50; SP New Energy Corp., which rose 11.3 percent to PHP1.28; and PLDT Inc., down 2.13 percent to PHP1,468 per share.

Stocks that advanced outnumbered those that declined by a ratio of 105 to 84, while 56 stocks ended unchanged. —Meg J. Adonis INQ