Index tumbles on lower growth forecast

MANILA, Philippines - Bearish sentiment dominated anew the stock market yesterday after the Asian Development Bank’s revised growth forecast for the economy sent shares tumbling.

The benchmark Philippine Stock Exchange index (PSEi) declined 41.18 points, or 0.58 percent, to close at 7,051.23, while the broader All Shares index tumbled 21.30 points or 0.52 percent to finish at 4,033.56.

Analysts said the lack of positive leads plus the downward revision of the ADB’s economic growth forecast for the Philippines amid a slowdown in major industrial economies in the region made investors jittery.

In a briefing yesterday, the ADB said the country’s gross domestic product (GDP) is expected to expand by six percent this year, lower than its previous forecast of 6.4 percent.

ADB country director Richard Bolt said state spending, steady inflows from overseas Filipinos, private consumption and low inflation could keep the economy steady but at the same time he recognised the threat of El Niño on the countryside as well as its negative impact on commodity and utility prices.

He said it was important to sustain the grown momentum through the creation of more jobs.

Decliners outnumbered gainers, 93 to 92, while 34 issues were unchanged.