Index rallies on US Fed announcement

MANILA, Philippines - The Philippine Stock Exchange index (PSEi) climbed above the 7,800 mark yesterday as global markets rejoiced following the Federal Reserve’s announcement that it will hike interest rates at a slow pace.

The index gained 0.75 percent or 57.97 points to settle at 7814.55, while the broader all shares index also managed to pick up 0.41 percent or 18.59 points to close at 4,520.78.

“Directions took its cue from Wall Street’s ascent given players’ positive response to the Fed’s indication of gradual increases in interest rates,” said Jason Escartin, investment analyst at F Yap Securities.

“The PSEi rode on the region-wide cheer. The local market climbed to the green on the week-to-date and looks poised to snap last week’s losses,” added Justino Calaycay Jr., analyst at Accord Capital Equities Corp.

Calaycay said US stocks rallied by over 1.2 percent overnight following the Fed’s dropping of the word “patience” in its guidance language for interest rates.

“Instead, it avowed adjustments will ‘go slow’ in consideration of further improvements in the macro economic data and of pushing inflation rates towards the two percent target,” he added.

Only two counters locally were in the negative territory – industrial and mining/oil companies – which declined 0.44 and 0.22 percent, respectively.

Services, financial and property firms, meanwhile, climbed by more than one percent each.

Market breadth was positive during yesterday’s session as advancers beat decliners, 93 to 88, while 44 stocks were unchanged.