PH stocks gain as region slumps on Japan recession

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THE Philippine Stock Exchange index (PSEi) was firmer at the start of the week on selective buying, bucking regional weakness following news that Japan has officially entered a recession.

Optimism over the upcoming release of third-quarter gross domestic product (GDP) figures on November 27 also buoyed local sentiment as earnings releases are “coming to a close.”

The benchmark index closed up 12.38 points or 0.17 percent at 7,229.72, while the All Shares index rose 8.98 points or 0.21 percent to 4,254.94.

The market also shrugged off the effect of jobless claims in the US, resulting in a mixed Wall Street result on Friday, which saw the Dow Jones falling 18.05 points while the S&P 500 inched up 0.49 points and Nasdaq added 8.40 points.

Over the weekend, US jobless claims went up to 290,000, higher than the forecast 280,000.

Most Asian markets fell on Monday after Japan’s gross domestic product shrank 1.6 percent in the third quarter from a year before, missing projections for a 2.2 percent gain.

Luis Limlingan, managing director at Regina Capital Development Corp., said in a phone interview that the market went up on Monday as a “carryover” of gains last week and with investors anticipating the third quarter GDP results to be favorable.

“To wrap it up, the earnings [season]is coming to a close. And now, basically, what’s happening is that [investors]are waiting for the GDP data to come out next week,” Limlingan said.

“Volumes have fallen. The market is moving up but there are not enough buyers. I think this is still going to consolidate” in the next few days, he added.

Limlingan said the market will still likely undergo further consolidation before see a “Santa Claus rally” that will push the market up to 7,400 points by yearend.

If GDP results turn out to be favorable, Limlingan said the main PSEi may start gaining momentum and climb even up to 7,600 points given the usual yearend rush.

“This week, our support level is at 7,160 points and resistance is at 7,250. If the market breaks the immediate resistance, the next resistance is at 7,360 points, which I think is not to be retested this week. But if it does, it is not sustainable,” Limlingan said.

All sectors ended in the green. Financials inched up 0.03 percent or 0.54 points to 1,708.70; industrials were up 0.38 percent or 43.97 points to 11,706.16; holding firms rose 0.07 percent or 4.44 points to 6,274.66; services added 0.25 percent or 5.35 points to 2,134.54; mining and oil advanced 0.64 percent or 98.32 points to 15,404.56; and property climbed 0.19 percent or 5.42 points to 2,873.66.

Of the most active stocks, the big winners were Southeast Asia Cement Holdings Inc. (Seacem) with a 13.92 percent gain, SSI Group Inc. with a 4.8-percent advance, and Robinsons Retail Holdings with a 3.6-percent rise.

Limlingan said Seacem had “small players” or small retail investors that were “coming in,” while SSI’s leap was mainly on speculation of strong fourth quarter sales, which caused its stock price to rise on Monday.

Among the most active losers were PLDT, Alliance Global Group Inc.,Vista Land and Lifescapes Inc., and Metrobank.

Total shares traded reached 2.75 billion worth P6.16 billion. Decliners outpaced advancers 96 to 72, while 56 shares were unchanged.

On Friday, the PSEi was up 0.26 percent or 18.71 points at 7,217.34, while the All Shares index added 0.21 percent or 8.90 points to 4,245.96.

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