Stocks inch up as market waits for BSP meeting

Philippine shares inched higher on Tuesday amid a lack of leads and market caution ahead of the central bank’s policy meeting this week.

The bellwether Philippine Stock Exchange index (PSEi) rose by 0.06% or 4.11 points to close at 6,608.36 on Tuesday, while the broader all shares index rose by 0.11% or 4.15 points to end at 3,511.91.

“The local market inched up by 4.11 points (0.06%) to 6,608.36 as investors hunted for bargains. Investors maintained a cautious stance, however, while waiting for the Bangko Sentral ng Pilipinas’ (BSP) policy decision later this week, leading to a struggle for the market to find direction,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message.

“The digestion of first-quarter corporate earnings helped in bringing the local market to a positive close,” Mr. Plopenio said.

The Monetary Board will meet to discuss policy on May 16, Thursday.

A BusinessWorld poll showed 17 out of 19 analysts expect the BSP to keep its policy rate at a 17-year high of 6.5% for a fifth straight meeting this week.

Meanwhile, one analyst expects the central bank to cut rates by 25 basis points (bps), while another sees the Monetary Board raising rates amid persistently elevated inflation.

The BSP raised borrowing costs by a cumulative 450 bps from May 2022 to October 2023.

“Philippine shares ended Tuesday’s trading session in the green as investors looked ahead into the MSCI rebalancing announcement and anticipated key US inflation reports. The producer price index for April is set to be released at 8:30 a.m. Eastern Time,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“The closely watched consumer price index is due on Wednesday, with expectations of a 0.4% month-on-month increase and a 3.4% year-on-year rise,” he said.

Sectoral indices ended mixed on Tuesday. Property increased by 0.97% or 23.68 points to 2,461.30; mining and oil climbed by 0.56% or 51.40 points to 9,204.87; and holding firms went up by 0.55% or 32.48 points to 5,877.45.

Meanwhile, services dropped by 0.91% or 18.36 points to 1,980.78; financials retreated by 0.2% or 4.31 points to 2,056.47; and industrials went down by 0.05% or 5.26 points to 9,095.54.

“Among the index members, Converge ICT Solutions, Inc. was at the top, climbing 4.41% to PHP 9.24. Century Pacific Food, Inc. lost the most, dropping 3.46% to PHP 33.50,” Mr. Plopenio said.

Value turnover declined to PHP 4.92 billion on Tuesday with 498.39 million shares changing hands from the PHP 11.04 billion with 949.4 million issues traded on Monday.

Decliners narrowly outnumbered advancers, 98 against 94, while 39 names closed unchanged.

Net foreign selling stood at PHP 158.14 million on Tuesday versus the PHP 3.33 billion in net inflows recorded on Monday. — Revin Mikhael D. Ochave