Below target growth dampens market

MANILA, Philippines — The stock market plunged yesterday as the below target economic expansion in the first quarter did not sit well with investors.

The benchmark Philippine Stock Exchange index lost 1.75 percent or 116.72 points to close at 6542.46.

It was the same fate for the broader All Shares index, which fell by one percent or 35.02 points at 3,481.55.

The government yesterday reported that the country’s gross domestic product (GDP) grew by 5.7 percent in the first quarter, below the six to seven percent target penned by economic managers via the Development Budget Coordination Committee (DBCC) for 2024.

“The local stock market faced a setback following the disappointing first quarter 2024 Philippine GDP figures. GDP stood at 5.7 percent, falling short of the consensus projection of 5.9 percent and trailing behind the DBCC’s target range of six to seven percent,” Luis Limlingan of Regina Capital said.

Philstocks Financial research and engagement officer Mikhail Plopenio said investors were weighed by the dismal first quarter 2024 GDP data.

“This raised worries over the country’s economy amid the lingering headwinds including inflation and elevated interest rates,” he said.

Plopenio said the decline of the some index heavyweights as well as the P1.52 billion net foreign outflow also weighed on the bourse.

He said net market value turnover, however, was quite strong at P5.66 billion, higher than the year-to-date average of P4.98 billion.

All sectors, except for industrial, were in the red, led by holding firms, which dropped 3.02 percent. Financials also suffered a steep decline of 2.03 percent.

Industrial managed to eke out a 0.40 percent increase.

Market breadth was positive as advancers edged out decliners, 95 to 87, while 43 issues were unchanged.

ACEN posted the biggest gain among index members with 8.61 percent, while JG Summit lost the most at 4.88 percent.