Stocks rebound on bargain hunting ahead of GDP

SHARES BOUNCED back on Monday as investors went bargain hunting ahead of the release of second-quarter gross domestic product (GDP) data.

The Philippine Stock Exchange index (PSEi) ended a fourday losing streak as it climbed 33.69 points or 0.42% to end at 7,962.12 yesterday.

The broader all shares index likewise climbed 0.52% or 24.23 points to 4,706.04.

“I think it’s just bargain hunting of selected stocks ahead of [ second- quarter)] GDP. If GDP comes in better than expected, PSEi might retest 8,000. Downside risk is 7,800,” IB Gimenez Securities, Inc. analyst Joylin F. Telagen said in a text message.

A poll of 12 economists conducted by BusinessWorld last week showed a median GDP growth estimate of 6.5% for the second quarter, slightly faster than the 6.4% recorded in the first three months, but slower than the 7.1% logged in the same period in 2016.

“Broader financial conditions eased incrementally and the credit impulse — derived from data on bank lending to the real economy until end-June 2017 — suggests more support for private spending growth than in [the first quarter]… Public spending rebounded in sequential and year-over-year terms in [the second quarter], suggesting more meaningful support for overall growth from government spending than in the first quarter,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message.

Mr. Limlingan added that the market took its cue from Wall Street’s positive performance last Friday.

“The Philippines hence looked to a positive start on Wall Street’s leads, on some bargain hunting, but as expected it was a muted bounce given tension between US and North Korea is still escalated,” Mr. Limlingan said in a mobile phone message.

Last Friday, the Dow Jones Industrial Average rose 14.31 points or 0.07% to 21,858.32; the S& P 500 gained 3.11 points or 0.13% to 2,441.32 while the Nasdaq Composite added 39.68 points or 0.64% to 6,256.56.

Back home, all sectoral indices ended in positive territory on Monday, led by the property sector, which inched up 1.06% or 39.51 points to 3,767.89, followed by mining and oil counter which ended at 12,587.37, higher by 0.76% or 95.16 points.

Holding firms climbed 0.48% or 37.36 points to 7,840.80; industrials was up by 0.33% or 35.46 points to 10,829.39; services added 4.57 points or 0.27% to 1,689.89; and financials saw a 0.07% or 1.48- point increase to 1,989.57.

Decliners narrowly beat advancers, 75 to 74, while 100 names closed unchanged.

Value turnover went down to P5.11 billion on Monday from Friday’s P5.50 billion, with 764.61 million changing hands.

Foreign inflows were slightly up on Monday at a net P265.61 million against the P251.90 million net buying recorded last Friday.