Philippine stocks inch up as interest rate cut looms
Photo taken from pse.com.ph
MANILA, Philippines—Local stocks rose marginally on Wednesday, shored up by property companies, which gained on prospects of a fresh interest rate cut by the Bangko Sentral ng Pilipinas in its meeting on Thursday.
The main-share Philippine Stock Exchange index added 2.06 points, or 0.04 percent, to finish at 5,161.80.
“Prices were down most of the day only to recover at the close. Too much fear is being priced into stocks. It should be worth rethinking,” said fund manager Gus Cosio, president of First Metro Asset Management Inc.
There was mixed trading across counters, with the financial and services counters slightly firming up and the industrial, holding firms and mining/oil slightly declining. On the other hand, the interest rate-sensitive property counter was an outperformer for the day, rising by 1.89 percent.
There is rising expectation that the BSP will cut its key interest rate, the overnight borrowing rate, by 25 basis points to 3.75 percent during its policy rate setting on Thursday (July 26). This is based on several institutional economic reports that have come out this week.
Investors picked up shares of property stocks Megaworld (+4.69 percent), RLC (+3.94 percent), ALI (+2.56 percent) and FLI (+3.85 percent).
URC, Globe, Semirara and First Gen also aided the index.
But buying was still selective as other large-cap stocks like AC, SMIC, BDO, Metrobank, MPI, AEV, AGI, ICTSI traded in the red. Puregold, GT Capital and FPH also closed lower.
Across the region, sentiment was still sluggish due to lingering debt concerns in the eurozone and the disappointing earnings of Apple.
Value turnover for the day amounted to P4.9 billion. There were 76 advancers versus 77 decliners while 46 stocks were unchanged.
