Philippine stocks closed higher on Tuesday as players picked up cheap stocks after two days of market decline, but sentiment remained cautious ahead of the US Federal Reserve's policy decision.
The benchmark Philippine Stock Exchange Index (PSEI) rose 0.32% or 19.40 points to close at 5,953.16, while the broader all-share index rose 0.21% or 7.78 points to 3,589.51.
Louis A., head of sales for Regina Capital Development Corp. “The Philippine market closed higher on bargain-hunting after two consecutive days of heavy selling. Investors remained cautious, closely watching upcoming earnings reports and the US Federal Reserve's anticipated next move, which could impact the market's direction,” Limlingan said in a Viber message.
AP Securities, Inc. Research head Alfred Benjamin R. “The market has broken its losing streak, but the one-third percent bounce remains unconvincing as investors await the Fed's rate cut decision,” Garcia said in a Viber message.
Fed policymakers are widely expected to cut US short-term borrowing costs by a quarter percentage point for the second time this week as they try to prevent a further slowdown in the labor market, Reuters reports.
Chances are this won't be the last of the series.
The surge in unemployment insurance claims shows labor market demand continues to decline, even though the government shutdown has delayed the publication of most official economic data, including the unemployment rate, last estimated at 4.3% in August.
Lower-than-expected inflation readings, including last week's report that the consumer price index rose 3% in the 12 months to September, have overshadowed concerns of tariff-driven price pressures.
A quarter-point rate cut would take the policy rate to a range of 3.75%-4% at the conclusion of the Fed's two-day meeting on Wednesday. Financial markets are betting heavily on further rate cuts in both December and January.
On the domestic front, sectoral indices closed mixed on Tuesday. Mining & Oil fell 4.42% or 565.68 points to 12,230.69; Industrials fell 0.27% or 24.08 points to 8,772.47; And the asset slipped 0.01% or 0.39 points to 2,198.54.
“The mining sector was the biggest decliner with a 4.4% decline as gold prices continued to slide,” Mr Garcia said.
Meanwhile, the Financials rose 1.15% or 22.44 points to 1,970.64; Services rose 0.42% or 9.76 points to 2,282.42; And holding firms rose 0.05% or 2.43 points to 4,807.25.
Advancers beat decliners by a slim margin, 95 to 94, while 62 names closed unchanged.
Value turnover declined to P4.64 billion on Tuesday, with 1.18 billion shares traded, down from Monday's P18.77 billion, with 11.82 billion issues traded.
Net foreign sales increased from P313.66 million to P432.57 million. , Alexandria Grace C. Magno with reuters
