Weak US economic performance dampens Phl stocks

MANILA, Philippines - The main index slipped anew yesterday as negative news abroad discouraged investors locally.

The Philippine Stock Exchange index (PSEi) dropped 0.57 percent or 28.79 points to 5,062.44, while the broader all shares index fell 0.34 percent or 11.34 points to 3,365.81.

“We were more of sideways trading yesterday. But the slower first quarter gross domestic product (GDP) growth in the US overshadowed the unexpected first quarter data (in the Philippines),” said Freya B. Natividad, investment analyst at brokerage firm 2Trade-Asia.com.

The US Commerce Department revised its estimates on first quarter economic growth to 1.9 percent from the 2.2-percent rate initially reported.

“After Thursday’s buying frenzy, the market fell from start to finish with the downturn in neighboring markets,” RCBC Securities said.

RCBC Securities added that Asian markets retreated due to China’s weak manufacturing numbers in May and the timid economic growth in the US.

The local market followed the trend in the US. On Thursday in the US, the Dow Jones industrial average slipped 0.2 percent or 26.41 points to 12,393.45, while the broader Standard & Poor’s 500 index retreated 0.2 percent or 2.99 points to 1,310.33.

Natividad said the negative news again raised concerns over the global economic recovery.

Week-on-week, the bellwether PSEi was still higher by 2.77 percent or 136.47 points from 4,925.97 on May 25.

“The 136-point recovery was brought about by political highlights during the week and better than expected first quater GDP of 6.4 percent, prompted by service sector growth and government spending,” said AB Capital analyst Maria Arlysa E. Narciso.

On Friday, subindices were mixed, with gainers led by mining and oil firms that added 0.6 percent or 142.59 points to 23,829.26 while property companies inched up 0.41 percent or 7.38 points to 1,830.15.