Market flat after disappointing growth figures

Share prices closed flat yesterday following disappointing third quarter growth figures, dealers said.

They said the market may be taking a breather after a three-day weekend and hitting eight-month highs last week. The markets were closed on Monday for a public holiday.

The Philippine Stock Exchange composite index rose 1.26 points at 2,107.36, having trading in a very narrow range of 2,102.70 to 2,109.79 as the market digested the growth data.

Gainers led losers 40 to 29, with 50 stocks unchanged.

The economy expanded 4.1 percent in the third quarter of the year, well below market expectations due to the effects of high oil prices, political instability and sluggish farm and industrial output.

With the poor third-quarter performance, officials said they now expect full-year gross domestic product (GDP) growth to come in below the initial target of 5.3 percent.

"Before trading started, investors were thinking that the GDP report could be a catalyst for another market rally but it turned out the figures were disappointing," said Ron Rodrigo of Accord Capital Equities.

Trading may remain sluggish as more investors learn about the poorGDP data, said Rodrigo.

"We’re coming into the market after a long weekend. It’s possible that some investors are still on vacation," said Oliver Plana of Asiasec Equities Inc.

Philippine Long Distance Telephone Co. (PLDT) was the most actively traded stock, rising P10 to P1,745.

Ayala Corp. gained P2.50 to P342.50 while unit Bank of the Philippine Islands advanced 50 centavos to P59. Manila Water Co. rose 10 centavos to P6.60.

San Miguel Corp. A shares, exclusive to Filipinos, gained 50 centavos to P65 while San Miguel Corp. B shares, available to foreigners, ended steady at P88.50.

"It’s possible the central bank might consider the latest economic data to keep rates where they are now,’’ said Mark Canizares, an analyst at CitisecOnline in Manila. "We still have a positive view on the market.’’

In last week’s auction, the Philippine 91-day Treasury bill yield, used by banks as a benchmark for lending rates, fell to its lowest in more than two years on optimism the government will narrow the budget deficit for a fourth year.

Almost 1.54 billion shares valued at P932 million changed hands today, little changed from the daily average over the past three months. – AFP