Stocks top 6,900 on weak US data


The benchmark stock exchange index perked up to beyond 6,900 points at the start of the week, with investors buying on indications that the US central bank would hold off from raising policy rates.

Already rising more than 1 percent in earlier trade, the Philippine Stock Exchange index (PSEi) ended at 6,961.93, up 111.32 points for a 1.63 percent increase. The wider All Shares index added 54.36 points or 1.37 percent to 4,011.55.

Lexter Azurin, equity analyst at Unicapital Securities Inc., said the PSEi was pulled up by positive investor sentiment given a Wall Street boost on Friday as well as the latest US jobs data.

“Today, all markets rallied on the back of strong US markets. This is amid the weak US jobs report that was released on Friday,” Azurin said.

“The report basically boosted sentiment of investors; it diminishes the probability of a Fed rate hike which was the concerns for markets globally,” he added.

US non-farm payrolls grew by only 142,000 in September, far lower than the 203,000 jobs the markets had expected.

The data also indicated a stall in US hourly wage growth, which sparked doubts on the strength of the economy to withstand a Fed rate hike before the end of the year.

Azurin noted that most analysts now expected the US central bank to increase interest rates by January 2016.

He said the PSEi could consolidate at 6,800 to 6,900 in the coming days until a clearer vision of the US and Chinese economies arises.

“The focus now is on the US and Chinese economies because they are the first and second largest economies in the world,” he said.

Asked if the local equities would be affected significantly by inflation and exports data releases this week, Azurin said: “it would also affect the market … but the market will focus more on the global developments.”

The local market has mostly been tracking Wall Street in the past weeks.

Azurin said foreign investors were still the biggest participants in Philippine stock, taking up 58 percent of overall trading year-to-date.

All subsectors ended positively on Monday, led by property and services which jumped 2.33 percent and 2.50 percent, respectively.

Gainers topped decliners at 112 versus 65, while 32 were unchanged. Total traded shares amounted to 2.684 billion, valued at P9.149 billion.

Last Friday the bellwether PSEi fell by 0.59 percent or 40.33 points to 6,850.61 while the wider All Shares index decreased by 0.46 percent or 18.26 points to 3,957.19.


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