Local shares bounce back as inflation eases
By Denise A. Valdez, Reporter
LOCAL shares bounced back at the end of the trading week as investors reacted to the news of inflation easing more than expected in September and to the possibility of the Fed lowering interest rates again this month.
The benchmark Philippine Stock Exchange index (PSEi) surged 2.11% or 159.05 points to close at 7,704.60 on Friday. The broader all-shares index likewise jumped 1.56% or 71.59 points to 4,675.60.
“With inflation falling below consensus estimates, and the probability of US rate cut increasing, investors finally turned into bargain hunters to end the last trading session for the week,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile message.
The Philippine Statistics Authority reported headline inflation slowed to 0.9% in September from 1.7% in August, reaching a more than three-year low.
Gabriel Jose F. Perez, sales associate at Papa Securities Corp., said the inflation report on Friday morning likely drove the activity of the stock market which also got a lift from the US markets’ performance overnight.
Fed policymakers expressed possibility of announcing another rate cut after its meeting this month, a Reuters report said, which is in line with expectations of investors.
Foreign investors remained sellers on Friday, with a net foreign selling of P1.32 billion from P1.26 billion on Thursday.
All sectoral indices closed in green territory, led by by the industrial index which climbed 1.34% or 138.62 points to 10,477.26.
Mining and oil grew 2.05% or 177.65 points to close at 8,843.07, followed by holding firms which increased 1.58% or 117.10 points to 7,551.58.
Next is the property index which widened 2.91% or 113.40 points to 4,010.90, then financials which improved 3.03% or 53.13 points to 1,805.59. Services saw an uptick of 0.53% or 7.98 points to 1,510.64.
Value turnover declined to P5.08 billion from P8.30 billion on Thursday, with 420.38 million issues changing hands.
Advancers outpaced decliners, 112-60, while 46 names were unchanged.
In the coming week, Mr. Perez said the movement of the PSE may be influenced by the US market.
“Movement next week for the PSEi should still be highly likely influenced by US market movement. Support remains at May’s low of 7,475,” he said.
