The local stock barometer climbed back to the 7,200 level on Thursday as investors were unfazed by the US Federal Reserve’s signal of further interest rate hikes.
The main-share Philippine Stock Exchange index gained 89.72 points or 1.25 percent to close at 7,246.08, firming up for the second straight session as investors picked up oversold stocks.
A sanguine view of the US economy offered by US Fed chair Janet Yellen was seen as a signal that the US central bank will proceed with further interest rate hikes, a move which will continue to strengthen the US dollar. This has been counter-balanced, however, by US president Donald Trump’s concerns on the strengthening of the greenback.
BDO Unibank chief strategist Jonathan Ravelas said that being a businessman, Trump would prefer a more competitive currency to benefit the US industrial sector. This is in turn seen to benefit emerging markets since this will temper the depreciation of local currencies.
Bargain-hunting continued at the Philippine markets despite mixed US stocks trading overnight, said Luis Gerardo Limlingan, managing director at stock brokerage Regina Capital.
“A comment from Janet Yellen, citing that the central bank will stand ready to raise interest rates if the US economy strengthens, follows a stronger CPI (consumer price index), climbing to 2.1 percent or above the Fed target of 2 percent,” Limlingan said.
“The latest figures—driven in part by an uptick in energy prices—suggest a four-year stretch of historically low inflation could be ending as the expansion advances and unemployment recedes,” he said.
At the local market, all counters firmed up on Thursday, led by the industrial, services and property counters, which all surged by over 1 percent.
Value turnover for the day amounted to P5.86 billion. There were 112 advancers that edged out 70 decliners while 49 stocks were unchanged.
Net selling for the day amounted to P379 million.
URC led the day’s upswing, rising by 3.84 percent while Ayala Land, Semirara and Megaworld all advanced by over 1 percent. SM Investments and Metrobank also contributed to the gains.
On the other hand, DMCI and Security Bank slipped.