THE LOCAL stock barometer rallied back to the 6,900 level Thursday as a knee-jerk reaction to the well-telegraphed US Federal Reserve’s move to raise interest rates for the first time in a decade.
The Philippine Stock Exchange index (PSEi) gained 97.98 points or 1.44 percent to close at 6,905.70 as global markets welcomed the US Fed’s quarter-percentage rate increase, seen as a vote on confidence on the resilience of the US economic recovery.
“We believe that the rally we are experiencing is only a short-term adjustment as the market is reflecting the relief that a policy change signaled earlier in the year, but was delayed, is finally on the way,” said Jose Mari Lacson, head of research at local stockbrokerage Campos Lanuza & Co.
“This monetary policy tightening should result in net outflow of foreign institutional investments (FII) and weaken the peso—unless the BSP (Bangko Sentral ng Pilipinas) also follows suit and matches with its own rate hike or other policy tools,” Lacson said.
The PSEi was led higher by the financial counter, which rose by 2.1 percent, while the industrial and holding indices likewise rose by more than 1 percent.
Only the interest rate-sensitive property counter ended in the red, weighed down by Ayala Land Inc., which fell by 2.79 percent and was the most actively traded stock for the day. Doris Dumlao-Abadilla