STOCKS rose on Monday on strong third-quarter results from listed companies and hopes the Federal Reserve will start considering minor rate hikes at next month’s meeting.
The benchmark Philippine Stock Exchange (PSEi) index rose 110.05 points, or 1.77%, to close at 6,295.58 on Monday, while the broader all-shares index rose 39.87 points, or 1.21% and ended at 3,313.57.
Philstocks Financial, Inc. research analyst Claire T. Alviar said PSEi rose on hopes of slower rate hikes by the Fed after dovish comments from several Federal Reserve policymakers last week.
Four Fed officials said they would still consider a smaller rate hike at their December 13-14 monetary policy meeting, even amid strong data that could argue for continued aggressive tightening to lower inflation.
The US Federal Reserve completed a fourth straight hike of 75 basis points (bps) last week, bringing the cumulative increase since March to 375 bps.
“Philippine equities moved sideways as adverse macroeconomic conditions were offset by better-than-expected corporate fundamentals,” said Jovis L. Vistan, vice president of AB Capital Securities, Inc., in a Viber message.
“Market participants had to contend with decades of inflation and rising interest rates around the world. However, initial corporate earnings results for the third quarter have been mostly better than expected,” added Mr. Vistan.
Philippine headline inflation rose to 7.7% in October, the fastest pace in nearly 14 years, on the back of higher food prices following recent typhoons.
This was up from 6.9% in September and 4% in October 2021 and was the fastest in almost 14 years, or since December 2008’s 7.8% during the global financial crisis.
In the first 10 months, inflation averaged 5.4%, faster than 4% a year ago and the central bank’s target of 2-4%, but still lower than its forecast of 5.6% for the year.
Almost all sector indices closed higher on Monday. Real estate rose 89.86 points, or 3.45%, to 2,693.49; Services rose 28.66 points, or 1.78%, to 1,635.26; Holding companies gained 78.55 points or 1.32% to close at 6018.61; Industrials added 103.93 points or 1.15% to close at 9112.49; and financials climbed 12.30 points, or 0.76%, to 1,615.29.
Meanwhile, mining and oil declined 102.98 points, or 1.03%, to 9,846.19.
Value turnover rose to 4.48 billion pesos on Monday, with 337.75 million shares changing hands, from 3.97 billion pesos with 304.79 issues traded on Friday.
Promoted teams overwhelmed relegated teams, 117 to 62, while 50 names closed unchanged.
Net overseas purchases rose to P391.21 million on Monday from P265.63 million on Friday.
AB Capital Securities’ Mr Vistan put PSEi’s support at 6150 and resistance at 6300. — AEO Jose