PSEi rises on bargain-hunting, BSP policy bets

Philippine shares rose on Monday on bargain hunting, the latest foreign direct investments (FDIs) data and expectations that the central bank will extend its policy pause for a fifth straight meeting this week.

The benchmark Philippine Stock Exchange index (PSEi) went up by 1.41% or 92.32 points to end at 6,604.25 on Monday, while the broader all shares index climbed by 0.88% or 30.63 points to close at 3,507.76.

“The local bourse jumped by 92.32 points (1.41%) to 6,604.25, attributed to bargain hunting following two consecutive days of market decline,” Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message. “Additionally, strong February FDI data bolstered sentiment.”

FDI inflows climbed by 29.3% to $1.364 billion in February from $1.055 billion in the same month a year ago, Bangko Sentral ng Pilipinas (BSP) data showed.

This was its highest level in 26 months or since the $2.662-billion net inflows recorded in December 2021.

“The market’s resilience and subsequent upward trajectory can be attributed to the prevailing sentiment that the BSP would opt to leave its benchmark rates unchanged. This provided a sense of stability and reassurance to investors and traders alike,” AB Capital Securities, Inc. Vice-President Jovis L. Vistan added in a Viber message.

“Market sentiment was further bolstered by speculation that the BSP’s may potentially shift towards a dovish monetary policy stance. This speculation gained traction primarily due to the disappointing household consumer spending data unveiled in the first-quarter GDP (gross domestic product) results,” he added.

A BusinessWorld poll conducted last week showed 17 out of 19 analysts expect the BSP to maintain its policy rate at a 17-year high of 6.5% for a fifth straight meeting at its May 16 review.

Meanwhile, Philippine GDP expanded by 5.7% in the first quarter, faster than the 5.5% expansion logged in October-December 2023.

However, this was slower than the 6.4% growth seen in the first quarter of 2023 and was below the 5.9% median forecast of 20 economists in a BusinessWorld poll.

This also fell short of the government’s 6-7% full-year economic growth target.

All sectoral indices ended higher. Services rose by 3.19% or 61.84 points to 1,999.14; financials surged by 2.7% or 54.26 points to 2,060.78; property went up by 0.91% or 22.10 points to 2,437.62; mining and oil climbed by 0.63% or 57.90 points to 9,153.47; industrials added 0.25% or 23.32 points to end at 9,100.80; and holding firms increased by 0.1% or 5.92 points to 5,844.97.

Value turnover rose to P11.04 billion on Monday with 949.4 million shares changing hands from the P3.67 billion with 424.84 million issues traded on Friday.

Advancers beat decliners, 118 versus 74, while 49 issues were unchanged.

Net foreign buying stood at P3.33 billion on Monday versus the P348.64 million in net foreign outflows seen on Friday. — R.M.D. Ochave