Disappointing GDP growth pummels index

MANILA, Philippines - A disappointing third quarter gross domestic product growth dragged the local benchmark index into the negative territory yesterday.

The Philippine Stock Exchange index (PSEi) failed to hold on to Wednesday’s momentum as it plunged 1.24 percent or 91.25 points to close at 7,265.34 on Thursday, with the All Shares index likewise following the drop as it lost 1.05 percent or 45.42 points to end at 4,279.97.

Analysts have their fingers pointed to a single culprit for Thursday’s sour mood – and that is the country’s lower-than-expected third quarter gross domestic product (GDP) growth.

The government reported yesterday that the Philippine economy grew 5.3 percent in the third quarter of this year, way below consensus forecast of 6.5 percent.

“All eyes and ears were trained on the release of the third quarter 2014 GDP numbers,” said Justino Calaycay Jr., analyst at Accord Capital Equities Corp.

As such, the local market reflected the disappointing GDP results with all counters in the local bourse ending in the red led by the property firms which dropped 2.87 percent or 83.76 points.

Market breadth was negative as decliners dominated advancers, 129 to 53, while 39 stocks were unmoved.

The PSEi was fresh from Wednesday’s 7,356.59 finish, a 2014 record close that eclipsed the year’s previous high of 7,355.29 recorded last Sept. 24.