PHILIPPINE SHARES inched up on Monday on bargain hunting and hopes that the Bangko Sentral ng Pilipinas (BSP) will hike rates more aggressively as headline inflation is seen to have hit a near four-year high in June.

The benchmark Philippine Stock Exchange index (PSEi) rose by 18.27 points or 0.29% on Monday to close at 6,183.62, while the broader all shares index went up by 8.34 points or 0.25% to 3,348.46.

“The local bourse extended its climb this Monday… This came as bargain hunters took opportunities from the market which has already declined for four consecutive weeks,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message that the market was “lifted by hopes that BSP has strong resolve to control inflation if indeed the data for last month come out way above consensus expectations.”

“Philippine shares were quietly bought up as the US was on holiday to celebrate its Independence Day,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

Mr. Limlingan added that Philippine inflation data to be released on Tuesday will be monitored by the market, as well as the publication of the minutes of the US Federal Reserve’s June meeting and US jobs data this week.

The Philippine Statistics Authority will release its June inflation report on Tuesday, July 5. A BusinessWorld poll of 16 analysts last week yielded a median estimate of 6% for June headline inflation, within the 5.7-6.5% forecast given by the central bank.

If realized, this would be well above the BSP’s 2-4% target and 5% forecast for the year and would also be faster than the 5.4% print in May and 3.7% in June last year.

This would also be the quickest headline print since the 6.1% seen in November 2018.

BSP Governor Felipe M. Medalla last week said the central bank may consider a more aggressive rate hike at its Aug. 18 meeting if inflation maintains its upward momentum, but noted the decision will remain data-dependent.

Sectoral indices were split. Financials climbed by 23.14 points or 1.59% to 1,474.58; holding firms gained 45.90 points or 0.80% to finish at 5,768.04; and industrials went up by 7.22 points or 0.08% to 9,060.23.

Meanwhile, mining and oil lost 146.50 points or 1.29% to close at 11,176; property went down by 23.53 points or 0.82% to 2,814.68; and services declined by 4.50 points or 0.27% to 1,657.11.

Value turnover increased to P3.85 billion on Monday with 499.98 million issues switching hands from the P3.71 billion with 508.22 million shares seen on Friday.

Decliners outnumbered advancers, 111 against 69, while 50 names closed unchanged.

Net foreign selling increased to P613.26 million from the P226.60 million recorded the previous trading day. — J.I.DP. Tabile