SHARES rose on Wednesday on last-minute buying ahead of the Federal Reserve’s policy decision.
The Philippine Stock Exchange (PSEi) benchmark index rose 6.53 points, or 0.09%, to close at 7,026.45 on Wednesday, while all shares broader were down 19.61 points, or 0.53%, to 3,713.68 climbed.
“Last minute purchases have propelled the local market higher this Wednesday. However, for most of the day, the market was in negative territory as investors prepare for the upcoming Federal Reserve policy decision, which already has the possibility of a rate hike,” said Japhet Louis O. Tantiangco, senior research analyst at Philstocks Financial , Inc sent a Viber message.
The Federal Reserve was expected to close its pandemic-era ultra-loose monetary policy on Wednesday and step up the fight against stubbornly high inflation with the first of a series of rate hikes this year, Reuters reported.
The shift, beginning with an expected quarter-point hike in the US Federal Reserve’s benchmark interest rate, has been in the works since last fall and has already pushed up the cost of home mortgages and other key types of credit, which the Fed will do to contain prices, which are increasing at the fastest rate in 40 years.
Nonetheless, the urgency surrounding this week’s Fed policy meeting has heightened as inflation shows no sign of slowing down and could potentially rise even higher on the back of the Russian invasion of Ukraine, which pushed up oil prices this month.
“Philippine stocks rebounded and closed slightly higher in February on falling oil prices and a weaker-than-expected US Producer Price Index (PPI) of 0.8%,” Luis A. Limlingan, director of sales at Regina Capital Development Corp, told a Viber message.
US producer prices rose in February as the cost of commodities such as gasoline soared, and further gains are in the pipeline after Russia’s invasion of Ukraine, which has made crude oil and other commodities more expensive.
The majority of sector indices ended in the green except for real estate, which fell 31.93 points or 0.95% to 3,325.52, and financials, which fell 6.75 points or 0.41% to 1,622.85 .
Meanwhile, mining and oil rose 260.91 points, or 2.20%, to 12,073.80; Industrials rose 164.43 points, or 1.74%, to 9,597.93; performances by 10.04 points or 0.55% to 1,835.45; and holding companies rose 5.76 points, or 0.08%, to 6,766.29.
Value turnover declined to P7.76 billion, with 1.32 billion shares changing hands, from P9.61 billion, or 3.61 billion issues, recorded the previous day.
Promoters outnumbered relegators, 119 versus 59, while 55 names closed unchanged.
Foreigners turned to buyers on Wednesday with net purchases of P23.87 million after Tuesday’s net sales of P660.90 million. — LMJC Jocson with Reuters