PSEi bucks prevailing market volatility

MANILA, Philippines - The stock market stayed resilient yesterday ahead of the US Federal Reserve meeting, bucking expectations the prevailing market volatility would continue to dampen sentiment.

The benchmark Philippine Stock Exchange index (PSEi) climbed 30.07 points,or 0.42 percent,  to  settle at 7,123.99, while the broader All-Shares index  edged higher  16.10 points or 0.40 percent.

Justino Calaycay of Accord Capital said the market has already discounted a Fed rate hike.

“The local market has shown a certain degree of resiliency this week, rising since Monday despite volatilities in global markets leading up to the Federal Reserve’s announcement later tonight. This could only mean two things with respect to this particular influence: prices have already discounted a hike; or the market expects the Fed to still leave the rates unchanged. This has resulted to encouraging improvements in the underlying market numbers,” Calaycay said.

He said PSEi should start filling the gap opened in August 24 by the yuan devaluation.

Edward Teather, economist at UBS, meanwhile, said a 10 percent decline in the yuan against the dollar would likely have a meaningful impact across Asia’s currency markets.

“That matters, because the change in the national currency against its trading partners on average matters more for the economic impact than the move against the yuan in isolation. Conversely currency depreciation will boost exporter margins and reduce domestic purchasing power,” he said.

Value turnover amounted to P6.76 billion. Advancing stocks outnumbered decliners, 114 as against 62, while 37 stocks were left unchanged.