Stocks up as inflation slows

MANILA, Philippines — Philippine stocks extended gains yesterday after data showed that inflation cooled more than expected in November.

The Philippine Stock Exchange index closed at 6,308.95, up by 24.58 points or 0.39 percent after the Philippine Statistics Authority (PSA) reported that headline inflation eased to 4.1 percent in November, the lowest since March 2022.

The broader All Shares index was likewise up by 4.58 points or 0.14 percent to close at 3,352.02.

The sectoral gauges were mixed with services, property and holding firms finishing in positive territory.

Mikhail Plopenio of Philstocks Financials attributed the market’s rise to last-minute bargain hunting, spurred by favorable inflation data.

“The local bourse was in the red territory for the most part of the day before a last-minute push from the buyers, ended the session above the 6,300 level,” he said.

However, market participation was weak with a net value turnover of P3.75 billion, lower than the year-to-date average of P4.89 billion. Foreigners were net sellers with net outflows amounting to P182.43 million.

Michael Ricafort of RCBC said the market also received a boost from the current four-month lows in the US dollar-to-peso exchange rate.

Market breadth was negative, with 94 losers against 82 gainers, while 41 issues were unchanged.

In other markets in Asia, shares declined on heavy selling of property and technology shares.

Hopes that inflation is easing enough to allow the Federal Reserve to stop raising interest rates have pushed shares higher in recent weeks. Investors are also hoping that the economy remains strong enough to avoid a recession.

This week will bring several key updates on the economy.

The Institute for Supply Management will release its November report on the services sector on Tuesday. The sector is a key component in the US economy and accounts for the majority of the nation’s jobs.

The labor market has remained strong in the US even as the Fed has raised interest rates sharply in order to fight inflation by slowing the entire economy.

Inflation has been falling since the middle of 2022. The central bank paused raising rates after its most recent increase in late July.