PHILIPPINE SHARES rose on Thursday on bargain hunting following a sharp sell-off the previous session and the central bank’s decision to keep benchmark rates steady.
The 30-member Philippine Stock Exchange index (PSEi) climbed 100.68 points or 1.41% to close at 7,233.26 on Thursday, while the broader all shares index inched up 53.52 points or 1.41% to 3,836.11.
“Local stocks have recovered on bargain hunting after a sharp sell-off yesterday as the market has already digested the news on the confirmation of the first two local cases of the Omicron strain,” Papa Securities Corp. Equities Strategist Manny P. Cruz said in Viber message.
The Department on Health announced on Wednesday that the country recorded its first two cases of the new coronavirus variant from a returning overseas worker from Japan and a passenger from Nigeria.
“Market recovered on the Bangko Sentral ng Pilipinas’ (BSP) decision to keep rates steady, suggesting favorable financing conditions onwards, supportive of economic and corporate earnings growth onwards,” First Metro In-vestment Corp. Head of Research Cristina S. Ulang said in a Viber message.
The BSP’s policy-setting Monetary Board, at its meeting on Thursday, decided to keep borrowing costs at record lows to continue supporting the economy even as inflation risks lean toward the upside.
All sectoral indices closed in the green on Thursday. Services gained 54.47 points or 2.79% to end at 2,002.46; industrial increased 158.06 points or 1.54% to 10,389.38; holding firms jumped 87.83 points or 1.26% to 7,028.18; financials rose 12.38 points or 0.77% to 1,620.30; mining and oil added 68.72 points or 0.75% to 9,167.55; and property went up 17.41 points or 0.54% to 3,201.87.
Value turnover jumped to P87.52 billion with 2.92 million issues switching hands on Thursday from the P11.35 billion with 1.33 billion shares traded the previous session.
Advancers outnumbered decliners, 109 versus 65, while 54 names closed unchanged. Net foreign buying sank to P79.44 million yesterday from the P237.63 million recorded the previous trading day.
Regina Capital Development Corp. Head of Sales Luis A. Limlingan said traders will look at US economic data to be released in the next few days, including the initial jobless claims and housing starts reports.
This is after the US Federal Reserve said on Wednesday it would end its pandemic-era bond purchases in March and pave the way for three quarter-percentage-point interest rate hikes by the end of 2022.
“The economy no longer needs increasing amounts of policy support,” Fed Chair Jerome Powell said in a news conference in which he contrasted the near-depression conditions at the onset of the coronavirus pandemic in 2020 with today’s environment of rising prices and wages and rapid improvement in the job market, Reuters reported.
Mr. Limlingan put the PSEi’s support at 7,100 and resistance at 7,260. — MCL with Reuters