Stock Market

Stocks climb on bargain hunting after Fed hike

Posted on March 17, 2017

THE STOCK MARKET went up slightly after the much-anticipated rate hike by the US Federal Reserve the other night.

The 30-member Philippine Stock Exchange index (PSEi) rose by 24.81 points or 0.34% to close at 7,278.60 yesterday. The broader all shares index closed at 4,386.08, up by 12.26 points or 0.28%.

Advancers outpaced decliners, 102 to 76, while 47 stocks were unchanged.

A total of 2.01 billion shares valued at P6.14 billion exchanged hands, lower than Wednesday’s P8.27 billion worth.

Except for the mining and oil counter, which gave up 0.56% or 68.23 points to close at 11,928.69, all other sub-indices were in positive territory.

The interest-rate sensitive property and financial sub-indices were among the gainers, up 0.44% and 0.38% to 3,244.68 and 1,827.99, respectively.

Among property companies, SM Prime Holdings, Inc. was up 0.35%, while Ayala Land, Inc. gained 0.56%.

BDO Unibank, Inc. and Metropolitan Bank & Trust Co. were among the most actively-traded in the financials sub-index, with gains of 0.66% and 0.90%, respectively.

Meanwhile, industrials gained 50.44 points or 0.45%, while the holding firms and services counters were up 32.58 points or 0.44%, and 3.29 points or 0.22%, respectively.

“The market returned to normal bargain hunting as the [Federal Open Market Committee] raised the funds rate target range, as widely expected,” said Regina Capital Development Corp. Head of Sales Luis A. Limlingan.

“The post-meeting statement made only minor changes to the description of the economy and continued to describe risks to the outlook as ‘roughly balanced,’” Mr. Limlingan said in an e-mail.

The Fed raised interest rates by 25 basis points after its two-day policy meeting for March, with the US’ steady economic growth expected to prompt two more rate hikes this year and three in 2018.

RCBC Securities, Inc. analyst Anton G. Alfonso said the Fed hike’s effect on trading was not significant as increase was already expected.

“This was expected already, so the market was supported by gains in Wall Street last night,” Mr. Alfonso said in a telephone interview.

All three main US counters were up overnight.

“The upward trend will be dependent on the outcome of additional data later such as the initial and continuing jobless claims and the Fed manufacturing index coming out tonight,” Mr. Limlingan said on Thursday.

RCBC’s Mr. Alfonso added that they expect the PSEi’s resistance to be at 7,340 in the coming days.

Other Southeast Asian stocks rose on Thursday, tracking an overnight rally in global shares after Fed Chair Janet L. Yellen’s comments suggested a more gradual pace of monetary tightening this year than many had expected. -- Arra B. Francia with Reuters