Share prices will likely remain flat this week as rising inflation rate will continue to be the top concern of stock market investors. The Bangko Sentral ng Pilipinas (BSP) is scheduled to announce the May inflation rate on Tuesday.
BSP Governor Benjamin Diokno last week hinted that headline inflation likely quickened to 5 percent-5.8 percent in May due to higher pump and food prices and a weaker peso. The inflation rate is well above the 2 percent to 4 percent target of the central bank for this year.
Analysts said the May inflation rate figure will be crucial to BSP’s interest rate decision during its upcoming policy meeting slated later this month.
“Value investors… warranted the anxiety; the market in recent years, after all, has been coddled by low inflation and unmoving interest rates. Those who have been in equities for far longer can zoom out and see economic cycle for what it is: periods of ebbs and flows,” said online brokerage firm 2TradeAsia.com.
The Philippine Stock Exchange Index last week added 0.2 percent to 6,741.40 while the broader All Shares Index rose 0.2 percent to 3,602.52.
Four of the six major sectoral indices posted week-on-week gains. Mining and oil gained 6.9 percent, holding firms advanced 2.5 percent, property rose 1.3 percent and financials increased 0.2 percent.
The industrial index decreased 2.4 percent while services fell 2.3 percent.
Foreign investors were net sellers for the week by P1 billion while the average daily value traded climbed to P11.67 billion from the previous week’s average of P8.9 billion.
Weekly top price gainers were Semirara Mining and Power Corp., jumped 12 percent to P37; DMCI Holdings Inc., which rose 5.7 percent to P9.30; and Nickel Asia Corp., which advanced 5.4 percent to P7.22.
Weekly top price losers were Globe Telecom Inc., which fell 7.7 percent to P2,328; Manila Water Co. Inc., which dropped 6.9 percent to P17.40; and GMA Network Inc., which declined by 5 percent to P11.34.
Meanwhile, stock markets mostly fell worldwide on Friday after data showed US employers added jobs at a better-than-expected pace last month, raising the prospect the Federal Reserve’s aggressive interest rate hikes will not be enough to contain inflation and avoid a recession. With AFP
Major Wall Street indices fell sharply, with the Nasdaq losing 2.5 percent, and were in the red for the week after a brief positive respite last week.
Paris and Frankfurt both closed slightly down. London’s FTSE 100 was closed for a holiday.
Oil prices, meanwhile, pushed higher, a day after the OPEC+ group of major oil producing nations led by Saudi Arabia and Russia agreed to raise output more than expected in the wake of a European Union ban on most Russian crude.
American employers added 390,000 jobs last month, a sign of a slowdown in hiring but still above forecasts amid a shortage of workers, according to the US Labor Department.
The jobless rate held steady at 3.6 percent for the third consecutive month.
The Fed has hiked interest rates to combat sky-high inflation, but investors worry that more aggressive moves could backfire and hamper economic growth. With AFP