Index manages to recover despite Fed jitters

MANILA, Philippines - All eyes are on the US Federal Reserve this week as the Federal Open Market Committee meets on Dec. 15.

The impending meeting, wherein the US Fed is widely believe to raise interest rates by 25 basis points, has investors jittery since last week.

Despite the prevailing cautious mood, the benchmark Philippine Stock Exchange index (PSEi) managed to recover before the end of the closing bell yesterday but still way below the 7,000-mark.

The benchmark PSEi finished at 6,745.99, down 10.98 points or 0.16 percent.

On the other hand, the broader All Shares index ended at 3,894.12, down by 0.74 points or 0.02 percent.

Most of the indexes – financials, industrial, services, mining and oil – closed in negative territory while the holding firms and property barometers buck the trend and both closed higher.

BDO market strategist Jonathan Ravelas said expectations are high the US would indeed raise rates.

Market watcher CNBC likewise said Asian equities closed mostly lower as investors remain focused on the mid-week decision from the US Federal Reserve.

MSCI’s broadest index of Asia-Pacific shares outside Japan hit a 2-1/2-month low and was last down 1.3 percent. Japan’s Nikkei slumped 2.1 percent as falling commodities hit energy and trading companies’ shares.

South Korea’s Kospi   retreated 1.1 percent and Australian shares dropped 1.8 percent.