PHILIPPINE STOCKS closed higher on Tuesday as players picked up low-cost stocks following the market’s two-day slide, but sentiment remained cautious before the US Federal Reserve’s policy decision.
The benchmark Philippine Stock Exchange index (PSEi) went up by 0.32% or 19.40 points to shut at 5,953.16, while the broader all shares index rose by 0.21% or 7.78 points to three,589.51.
“The Philippine market ended higher, driven by bargain-hunting after two consecutive days of strong selling. Investors remained cautious, closely monitoring upcoming earnings reports and the anticipated next move by the US Federal Reserve, which could influence market direction,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
“The market snapped its losing streak, however the rebound of a 3rd of a percent was unconvincing as investors await the Fed’s rate cut decision,” AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said in a Viber message.
Fed policymakers are widely expected to scale back US short-term borrowing costs this week by 1 / 4 of a percentage point for the second time this 12 months as they appear to stop further slowing within the labor market, Reuters reported.
Odds are it won’t be the last of the series.
Climbing unemployment insurance claims suggest that labor market demand continues to chill, whilst the federal government shutdown delays publication of most official economic statistics, including the unemployment rate, last estimated at 4.3% in August.
Milder-than-expected inflation readings, including last week’s report that the patron price index rose 3% within the 12 months through September, have put worries of tariff-driven price pressures on the back burner.
1 / 4-point rate cut on Wednesday on the close of the Fed’s two-day meeting would put the policy rate within the 3.75%-4% range. Financial markets are betting heavily on further rate cuts in each December and January.
Back home, sectoral indices closed mixed on Tuesday. Mining and oil slumped by 4.42% or 565.68 points to 12,230.69; industrials dropped by 0.27% or 24.08 points to eight,772.47; and property slipped by 0.01% or 0.39 point to 2,198.54.
“The mining sector counter was the largest loser with a decline of 4.4% as gold prices proceed to slump,” Mr. Garcia said.
Meanwhile, financials rose by 1.15% or 22.44 points to 1,970.64; services increased by 0.42% or 9.76 points to 2,282.42; and holding firms edged up by 0.05% or 2.43 points to 4,807.25.
Advancers narrowly beat decliners, 95 to 94, while 62 names closed unchanged.
Value turnover went all the way down to P4.64 billion on Tuesday with 1.18 billion shares changing hands from Monday’s P18.77 billion with 11.82 billion issues traded.
Net foreign selling increased to P432.57 million from P313.66 million. — Alexandria Grace C. Magno with Reuters