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THE PRIMARY INDEX fell to an over five-year low on Monday as unsatisfactory third-quarter gross domestic product (GDP) growth and feeble foreign direct investments (FDI) data triggered concerns of an economic downturn.
The benchmark Philippine Stock Exchange index (PSEi) declined by 0.98% or 56.73 points, concluding at 5,702.64, while the wider all shares index diminished by 0.45% or 16.14 points to finish at 3,498.43.
This represented the PSEi’s poorest performance in nearly five-and-a-half years or since its closure at 5,570.22 on May 28, 2020.
“The Philippine market closed lower despite more affordable valuations after the GDP figures were released. Investors continue to exercise caution about market entry as trepidations regarding macroeconomic conditions linger,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan conveyed in a Viber message.
“Philippine equities diverged from the regional rally following a report indicating that FDI plummeted by 40.5% in August and by 22.5% year-to-date, offering another data point that reinforces the case for sluggish economic growth for the rest of the year,” AP Securities, Inc. Research Head Alfred Benjamin R. Garcia mentioned in a Viber message.
Philippine GDP growth decelerated to an over four-year low of 4% in the third quarter, down from 5.5% in the previous quarter and 5.2% from the same period last year, as reported by the government on Friday.
This was significantly below market projections of over 5% growth, as allegations of corruption related to state infrastructure projects impacted government expenditure and consumer confidence.
The third-quarter GDP figure brought the nine-month average down to 5%, noticeably below the government’s full-year growth target of 5.5-6.5%. Officials stated that achieving this objective could prove quite challenging, even as they remained hopeful about a rebound in public and private spending this quarter.
In the meantime, net FDI inflows decreased by 40.5% year-on-year to $494 million in August, down from $830 million in the same month in 2024, according to the central bank’s report on Monday. For the first eight months, net inflows fell by 22.5% to $5.179 billion.
Mr. Limlingan further noted that the financial results of companies also added to the ambivalent market sentiment.
Most sectoral indices ended lower. Services fell by 1.36% or 31.35 points to 2,265.97; financials slipped by 1.34% or 25.77 points to 1,897.92; property decreased by 0.77% or 16.11 points to 2,061.35; holding companies declined by 0.48% or 22.21 points to 4,586.95; and industrials were down by 0.31% or 26.54 points to 8,371.29.
Conversely, mining and oil jumped by 7.18% or 912.01 points to 13,603.39.
Decliners surpassed advancers, with 100 to 85, while 56 stocks remained unchanged.
Value turnover decreased to P6.96 billion with 1.86 billion shares traded, down from P14.17 billion with 1.71 billion issues that exchanged hands on Friday.
Net foreign purchasing dropped to P122.02 million from P4.98 billion. — A.G.C. Magno
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