PSEi down further as investors retreat to assess BSP stance
MANILA -The Philippine Stock Exchange index (PSEi) tilted lower during a sluggish Friday session as investors took stock of the Bangko Sentral ng Pilpinas’ (BSP) latest views on inflation and pause in interest rate hikes.
The benchmark measure slid 0.18 percent, or 11.36 points, to 6,393.55 while the broader All Shares index was down 0.09 percent, or 2.94 points, to 3,414.75.
Volume weakened as 537.03 million shares valued at P3.32 billion changed hands while foreigners were net sellers of an amount totaling P268.51 million, data from the stock exchange showed.
The Monetary Board kept the key policy rate unchanged during its Thursday meeting while BSP Governor Felipe Medalla said average inflation in 2023 would likely cool to 5.4 percent.
READ: BSP policy rate kept at 6.25%
For its part, Bank of the Philippine Islands (BPI) said it was too early to conclude the current monetary tightening cycle was over.
“One or two more rate hikes are still possible for the rest of the year depending on how the [foreign exchange] market will react in case the [US Federal Reserve] hikes again,” the lender said in comments shared to the media.
“It might be too premature also to expect rate cuts later this year. With the Fed still keeping its hawkish stance, it might be difficult to cut rates while minimizing the impact on the currency,” BPI said.
Foreign reserves
“Refraining from cutting interest rates immediately and too aggressively will also allow the BSP to build up its foreign reserves. This is important as we are also seeing an increase in the country’s external debt,” it added.
READ: GIR held steady above $100B in April, says BSP
Meanwhile, PSE subsectors were mixed on Friday as mining and oil, property and services rose while holding firms, industrial and financials slumped.
SM Investments Corp., the most actively traded company during the session, dropped 0.05 percent to P909.50 per share.
It was followed by BDO Unibank Inc., down 0.57 percent to P140; JG Summit Holdings Inc., down 4.66 percent to P43; and International Container Terminal Services Inc., down 0.15 percent to P199.70.
Overall, there were 103 advancers against 89 losers while 41 companies closed unchanged.
