PSEi declines as April inflation quickens to 3.8%

Philippine shares declined on Tuesday as markets were weighed by inflation that quickened for the third straight time in April.

The benchmark Philippine Stock Exchange index (PSEi) shed 0.51% or 33.91 points to close at 6,618.58. The broader all-share index dropped by 0.3% or 10.76 points to 3,505.75.

Investors exercised caution as prices continued to pick up, nearing the upper end of the government’s 2-4% target, Mikhail Philippe Q. Plopenio, research officer at Philstocks Financial, Inc. said in a Viber message.

“Investors also traded cautiously while waiting for the Philippines’ first-quarter gross domestic product data set to be released later this week,” he added.

The local statistics agency said inflation accelerated to 3.8% in April from 3.7% in March on higher food and transport costs.

The local bourse dropped despite stronger US markets, Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message.

“In the US, equities rose for the third straight day following the weaker-than-expected nonfarm payroll employment data coupled with higher unemployment, fueling assumptions that the US Federal Reserve might need to cut rates soon with the overheating economy,” he said.

On the commodities side, gold prices gained on softer greenback and rate cut hopes, he pointed out.

Spot gold rose by 1.04% to $2,325 per ounce, while US gold futures increased by 1.13% to $2,334 per ounce.

Oil prices also advanced as investors assessed the Gaza cease-fire. Brent contract gained 0.45% to $83.33 per barrel, while West Texas Intermediate contract accelerated by 0.47% to $78.48 per barrel, he added.

Back home, the market’s sectoral indices were mixed. Property retreated by 2.65% or 64.52 points to 2,363.10, while financials shed 0.86% or 18.22 points to 2,077.43. Holding companies lost 0.49% or 30.09 points to 6,060.59.

On the other hand, mining and oil rose by 2.24% or 200.04 points to 9,100.91, while services gained 0.97% or 18.54 points to 1,928.88. The industrial index added 0.91% or 81.91 points to 9,057.04.

“The heavyweight SM Prime Holdings, Inc. led the index losers, adding to the market’s decline for Tuesday’s session,” Mr. Plopenio said. “Nickel Asia Corp. was at the top, climbing 4.49% to P4.19.”

Value turnover rose to P11.52 billion, with 7.9 billion shares traded compared with 491.98 million stocks worth P4.13 billion on Monday.

Decliners beat advancers 98 to 86, while 54 stocks were unchanged. Net foreign selling rose to P890.07 million from P279.75 million. — Revin Mikhael D. Ochave