Stocks extend gains as BSP poised to cut rates

MANILA, Philippines — The local stock market is making a run this week, as investors beef up their portfolios ahead of another rate cut by the Bangko Sentral ng Pilipinas (BSP) today.

The bellwether Philippine Stock Exchange index (PSEi) yesterday gained by 1.77 percent or 129.9 points to close at 7,456.31, flirting again with the 7,500 level.

The broader All Shares index also picked up by 1.53 percent, or 61.73 points, to land at 4,086.45.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said the PSEi again ended higher ahead of the widely expected BSP rate cut of at least 25 basis points.

Ricafort also cited the continued growth in overseas Filipino workers’ remittances to near record highs on a monthly basis as a bright spot for the economy.

Philstocks Research said all eyes are on the BSP later this afternoon, as it heads to a policy meeting to decide whether to do another rate cut. Philstocks Research also said the PSEi mirrored the positive performance over at Wall Street.

“Investors continued to draw optimism from the expectation that BSP will deliver another policy rate cut in its upcoming meeting (today).Positive cues from Wall Street’s record performance also helped in Tuesday’s session,” Philstocks Research said.

In August, the BSP delivered its first rate cut in nearly four years, to the tune of 25 basis points, to 6.25 percent, and has room for another one within the year.

All industries, except for mining and oil, made leaps yesterday, with Manila Electric Co. turning out to be the biggest winner, gaining by 5.1 percent to P495 a piece.

All throughout trading, the PSEi saw P6.41 billion worth of shares change hands, with advancers beating the decliners, 124 to 92, while 45 issues were unmoved.