Inflation jump drags PSEi down to 5,677

Philippine stocks fell on Tuesday as faster September inflation and a weak peso dampened investor sentiment, erasing part of the previous session’s gains.

The benchmark Philippine Stock Exchange Index (PSEi) shed 1.15 percent, or 66.09 points, to close at 5,677.12.

Philstocks Financial Inc. said investors weighed the latest headline inflation reading, which accelerated to 7.2 percent in September from 6.1 percent in August.

The figure was close to the upper end of the Bangko Sentral ng Pilipinas’ forecast range of 6.4 to 7.4 percent.

The peso’s continued weakness also weighed on market sentiment, the brokerage said.

Ron Acoba, chief investment strategist at Trading Edge, said the persistence of high long-term yields suggests that markets remain concerned about inflation, fiscal pressures and the prospect that interest rates could stay elevated for longer, maintaining a challenging backdrop for emerging-market equities.

“Domestic selling pressure may also be building ahead of the upcoming Mynt IPO as institutional investors begin freeing up liquidity to participate in the offering,” Acoba said.

Trading remained thin, with net value turnover reaching P4.04 billion. Foreign investors ended the session as net sellers, with net outflows of P293.89 million.

All sectoral indices declined. Mining and oil posted the steepest loss, falling 2.38 percent.

Among index stocks, ACEN Corp. bucked the downturn, rising 2.66 percent to P2.70 to become the session’s top gainer.

Emperador Inc. was the biggest laggard, dropping 7.59 percent to P15.10.

Toby Allan Arce, head of sales at Globalinks Securities and Stocks Inc., said overall, Tuesday’s decline reflected an increasingly difficult Philippine growth-inflation trade-off.

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