PHILIPPINE SHARES rose to 7,500 on Monday to post its best close since January 2020 as inflation fell to a four-year low in September, giving the central bank room to lower borrowing costs.
The bellwether Philippine Stock Exchange index (PSEi) rose 1.16% or 86.76 points to 7,554.68 on Monday, while the broader index of all shares rose 1.02% or 41.32 points to 4,082.97.
Monday’s close was the PSEi’s best close in nearly five years (over 56 months) or since it closed at 7,587.63 on Jan. 27, 2020.
The main index also touched an intraday high of 7,604.61 during Monday’s session.
“Strong buying interest, including net foreign inflows of P1.35 billion, propelled the market to its highest close since Jan. 27, 2020, as investors reacted to the combination of a surprising slowdown in Philippine inflation and a positive US jobs report,” Managing Director of Chinabank Capital Corp. Juan Paolo E. Colet said in a Viber message.
“The property market went up a lot on Monday. Investors continued to appreciate the significant drop in inflation in the Philippines last September as it strengthened the case for monetary policy expansion by the Bangko Sentral ng Pilipinas (BSP),” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco also said the same. in a Viber message. “The hope that the Fed will deliver more rate cuts again has fueled optimism.”
Philippine inflation fell to 1.9% in September from 3.3% in August and 6.1% last year, the government reported on Friday.
This was the slowest pace seen in four years or since the 1.6% print in May 2020. It was also below the BSP’s forecast of 2%-2.8% for the month and the 2.5% average rate found in the estimate BusinessWorld a survey of 15 analysts.
Analysts said the improvement in the inflation outlook would give the BSP more room to cut benchmark rates.
BSP Governor Eli M. Remolona, Jr. last week said the Monetary Board may bring a 25 basis point (bp) cut in its October 16 meeting, followed by another in its December 19 meeting.
The BSP in August lowered benchmark borrowing costs by 25 bps to kick off its easing cycle, bringing its policy rate to 6.25%.
Most industrial indices ended higher on Monday. The commodity rose by 2.04% or 60.64 points to 3,025.70; services increased by 1.89% or 43.48 points to 2,337.06; industrials rose by 1.21% or 120.79 points to 10,054.26; and holding firms increased by 1.2% or 76.34 points to 6,405.78.
Meanwhile, financials fell 0.46% or 11 points to 2,382.77, while mining and oil lost 0.39% or 35.57 points to end at 9,042.29.
Value turnover rose to P7.87 billion on Monday with 1.36 billion shares traded from P6.14 billion and 792.47 million shares traded on Friday.
Advancers outnumbered naysayers, 129 to 79, while 49 names remained unchanged.
Total imports increased to P1.35 billion on Monday from P607.93 million on Friday. – RMD Ochave
Source link
