The local stock barometer breached the 7,700 mark yesterday as a hawkish signal from the inflation-targeting Bangko Sentral ng Pilipinas (BSP) boosted investor appetite.
Rising for the fourth straight session since President Duterte’s State of the Nation Address on Monday, the main-share Philippine Stock Exchange index (PSEi) yesterday added 35.53 points or 0.46 percent to close at 7,701.38 as more foreign funds flowed to local equities.
Trading was sluggish in morning trade but early losses were reversed in the afternoon. The market was buoyed by about P370.7 million in net foreign buying.
For the week, the PSEi gained a total of 361.77 points or 4.9 percent from last week’s finish of 7,339.61.
Local stock brokerage Papa Securities said the local stock market had turned more optimistic now that “the BSP is finally reigning in its movements to get inflation back on target.”
The BSP is targeting to keep inflation within the 2-4 percent range. This target range had been breached since March this year. In June, the inflation hit a five-year high of 5.2 percent.
Papa Securities noted BSP Governor Nestor Espenilla’s statement that there would be no more reduction in the reserve requirement for the rest of the year. It also recalled the Governor’s hawkishness on Friday when he mentioned that the BSP was considering a strong follow-through adjustment in the next monetary setting this Aug. 9.
The PSEi was perked up by the modest gains eked out by the financial, industrial, holding firm, services and property counters.
On the other hand, the mining/oil counter dipped.
The PSEi was led higher by fast-food giant Jollibee, which jumped by 3.83 percent.
Ayala Land, Ayala Corp., SM Prime, BPI and JG Summit all firmed up by over 1 percent.
ICTSI, AEVm AGI and Puregold also gained.
On the other hand, investors sold down shares of Megaworld, which lost 3.29 percent. Metro Pacific and GT Capital both slipped by over 1 percent.
BDO, SM Investments and PLDT also faltered.