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Market sits out BSP rate move on the sidelines

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PSE BGC bells

SHARES ended flat on Thursday as investors stayed on the sidelines ahead of the Bangko Sentral ng Pilipinas’ (BSP) sixth monetary policy review for the year that resulted in 2019’s third cut in policy interest rates, as widely expected.

The benchmark Philippine Stock Exchange index (PSEi) barely moved at closing on Thursday, crawling up 0.003% or 0.24 point to close at 7,896.48. The broader all-shares index slipped 0.01% or 0.75 point to 4,769.34.

“Despite the foreign selling amounting to P472 million today, the PSEi ended flat as investors hunted for blue-chip stocks that have been lagging for the past few days. Investors were also expecting the highly anticipated rate cut that the BSP announced 30 minutes after market close,” Timson Securities, Inc. Equity Trader Jervin S. de Celis said in a mobile phone message.

The BSP, in a meeting after the market’s close, decided to cut interest rates by 25 basis points (bps) as “price pressures have eased further,” BSP Governor Benjamin E. Diokno said in a briefing.

Yesterday’s monetary policy decision brought year-to-date cuts in benchmark interest rates to 75 bps, partially dialing back last year’s cumulative 175-bp hike.

“The rate cut may somehow boost market sentiment tomorrow and next week unless we see another negative news coming from the western markets that might hinder PSEi’s ascent above 8,000 level,” Mr. De Celis added.

Philstocks Financial, Inc in a market note said that the PSEi moved above the 200-day exponential moving average.

“The local bourse ended buoying above the 7,880 level… amid BSP policy rate meeting, month-end window dressing and offshore developments coming from the US and China trade talks,” the company said.

Four sectoral indices moved to positive territory, led by financials that went up 0.85% or 15.34 points to 1,807.54, followed by mining and oil which gained 0.71% or 65.56 points to 9,210.14, services which rose 0.29% or 4.62 points to 1,559.51 and property which added 0.17% or 7.01 points to 4,115.83. In contrast, holding firms slumped 0.42% or 32.99 points to 7,812.69 and industrials dropped 0.31% or 32.98 points to 10,622.45.

Some 773.24 million issues worth P5.69 billion changed hands, compared to Thursday’s 617.20 million issues worth P5.79 billion.

Stocks that gained edged out those that declined, 107 to 80, while 57 others were unchanged.

Foreign investors remained net sellers for the second straight day at P472.88 million, 52.75% more than the previous session’s P309.58 million.

Major Wall Street indices rode hopes for a US-China trade deal, with the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite indices gaining 0.61%, 0.62% and 1.05%, respectively.

Major Asian bourses followed suit, with Japan’s Nikkei 225 and Topix indices increasing by 0.13% and 0.20%, respectively; as well as Hong Kong’s Hang Seng and South Korea’s Kospi indices gaining 0.37% and 0.05%, respectively. — Arra B. Francia





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