PHILIPPINE STOCKS rebounded on Wednesday, tracking Wall Street’s climb ahead of the US Federal Reserve’s policy decision and despite continued worries over elevated inflation that could slow down consumer spending.
The benchmark Philippine Stock Exchange index (PSEi) surged by 242.51 points or 3.57% to close at 7,035.76 on Wednesday, while the broader all shares index went up 96.77 points or 2.69% to end at 3,687.17.
“Philippine shares climbed as traders assessed how firms are faring amid high inflation and fears of slowing consumer spending. Meanwhile, US equities ended January on a good note, as strong earnings and encouraging inflation data pushed the indices to their best levels since January 2019,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort likewise said in a Viber message that the PSEi rose as it took its cue from overnight gains on Wall Street amid the latest easing in US wage inflation data and US home prices, which could support a less hawkish stance from the Fed.
Major US stock indexes rose on Tuesday as labor cost data encouraged investors about the Fed’s aggressive approach to taming inflation a day ahead of the central bank’s critical policy decision, Reuters reported.
The Dow Jones Industrial Average rose 368.95 points or 1.09% to 34,086.04; the S&P 500 gained 58.83 points or 1.46% to 4,076.60; and the Nasdaq Composite added 190.74 points or 1.67% to 11,584.55.
US labor costs increased at their slowest pace in a year in the fourth quarter as wage growth slowed, Labor department data showed.
The US central bank on Wednesday is expected to hike the fed funds rate by 25 basis points, following a 2022 in which the Fed aggressively boosted rates to control soaring inflation.
Aside from the Fed’s rate decision on Wednesday, Chair Jerome Powell’s news conference will be scrutinized for whether the rate-hiking cycle may be coming to a close and for signs of how long rates could stay elevated.
Back home, all sectoral indices closed higher on Wednesday. Services surged by 73.47 points or 4.34% to 1,766.10; holding firms added 245.16 points or 3.69% to end at 6,881.67; industrials went up by 301.98 points or 3.13% to 9,924.60; property increased by 82.38 points or 2.79% to end at 3,035.41; financials rose by 49.10 points or 2.74% to 1,839.50; and mining and oil climbed by 78.53 points or 0.72% at 10,894.80.
Value turnover went down to PHP 8.99 billion on Wednesday with 1.06 billion shares changing hands from the PHP 11.27 billion with 1.54 billion issues traded on Tuesday.
Advancers beat decliners, 143 versus 49, while 43 names closed unchanged.
Net foreign buying was at PHP 763.97 million on Wednesday versus the PHP 812.43 million in net selling seen the previous trading day.
RCBC’s Mr. Ricafort placed the PSEi’s support at 6,650-6,750 and resistance at 7,100. — Justine Irish D. Tabile with Reuters
This article originally appeared on bworldonline.com