Market bounces back ahead of potential rate cut

MANILA, Philippines — Local stocks bounced back yesterday on investor confidence that the outcome of economic data and the Bangko Sentral ng Pilipinas (BSP) meeting this week would swing to their favor.

The benchmark Philippine Stock Exchange index (PSEi) yesterday climbed by 0.22 percent, or 16.09 points, to close at 7,326.41, ending a four-day slump.

The broader All Shares index also picked up by 0.24 percent, or 9.56 points, to land at 4,024.74.

Regina Capital Development Corp. managing director Luis Limlingan said the market went on a slight run, thanks to investors who are preparing their portfolio for the days to come.

In particular, they look forward to the result of the policy meeting tomorrow, where the consensus among bankers is that the BSP’s Monetary Board will deliver another rate cut.

The central bank is widely anticipated to cut borrowing costs anew as inflation eased sharply to an over four-year low of 1.9 percent in September from 3.3 percent in August.

Inflation averaged 3.4 percent from January to September, well-within the BSP’s two to four percent target.

Moreover, the BSP will release tomorrow the August figures for overseas Filipino remittances.

Historically, remittances begin to pick up pace as the holiday season draws nearer, lifted by money sent back home by overseas Filipino workers.

“Shares made minor gains as investors gear up for yet another week of fresh economic data and events that would drive price action movement,” Limlingan said.

All industries in the market turned in positive numbers, with the exception of services.

All throughout trading, the market saw P3.88 billion in shares change hands, but by the bell, the winners beat the losers, 128 to 73, with 54 issues unchanged.