Index snaps 6-day winning streak

MANILA, Philippines - The Philippine Stock Exchange index (PSEi) snapped yesterday a six-day winning streak after the second quarter economic growth failed to impress investors.

The local stock barometer failed to reach a new 14-month high and instead declined 0.83 percent or 14.11 points to 7,100.70, a hairline above the 7,100 level. The broader all shares index also plummeted 0.62 percent or 26.14 points to 4,205.66.

Holding only to thin gains before the release of the second quarter gross domestic product (GDP) data in the morning session, Accord Capital Equities Corp. analyst Justino Calaycay Jr. said investors immediately turned as soon as the output came out  

“Trades following the data sent the market plummeting towards 7100. At the final bell, it settled exactly on the line,” Calaycay said.

The government reported yesterday that the economy grew 6.4 percent in the second quarter of the year, faster than the 5.6 percent performance in the first quarter. The growth, however, was slower than the 7.9 percent recorded in the second quarter of last year.

“The reaction to the second quarter GDP, however, seemed to deviate from the convention – 6.4 percent better-than-expected, better-than-previous-quarter – as investors looked another way, lower-than-last-year,” Calaycay said.

Calaycay, however, stressed that once investors are able to dissect the numbers and know that the economy is nearly back on track, it will provide encouragement to the market for the rest of the year.