Bargain hunting lifts stocks anew

MANILA, Philippines — Stocks continued to rally this week, ending higher yesterday as investors took the cue from the central bank’s decision to hold interest rates steady.

The benchmark Philippine Stock Exchange index (PSEi) closed at 6,211.89, up by 20.41 points or 0.33 percent, while the broader All Shares index finished at 3,324.77, up by 10.28 points or 0.31 percent.

Total value turnover improved to P4.9 billion. Market breadth, however, was negative, 88 to 80, while 53 issues were unchanged.

Claire Alviar of Philstocks Financials said the local bourse gained as sentiment was boosted by the decision of the Bangko Sentral ng Pilipinas to keep interest rates unchanged and downwardly revised its inflation projections for 2023 until 2025.

“Currently, investors are reacting positively to the slowdown in inflation, both domestically and in the US, giving hope to the investors that both the BSP and the Federal Reserve will consider a pause in hiking interest rates,” she said.

“The PSEi managed to close the week in the green as bargain hunters trumped fence sitters after the recent Monetary Board decision to maintain the status quo,” First Metro Securities said in a commentary.

“Despite better Q3 GDP and October inflation print, the central bank maintained a hawkish tone for its 2023-2025 inflation estimates.”

Elsewhere in Asia, shares were mostly lower after Wall Street drifted to a mixed finish as momentum slowed following a strong rally in the first half of November.

Several reports on Thursday indicated the US economy is slowing. Slightly more workers applied for unemployment benefits last week, and while the number is low relative to history, a softening in the job market could prevent strong raises in wages that the Fed fears could help keep inflation high.

“If anything, data on Thursday further highlighted the economic risks as a trade-off to tight monetary policies,” Yeap Jun Rong of IG said in a market report.

November is on track to be the S&P 500’s best month in a year on rising hopes for a “Goldilocks” economy that’s just right for markets.

The yield on the 10-year Treasury fell to 4.44 percent from 4.54 percent late Wednesday. Just last month, it was above five percent at its highest level since 2007 and raising worries on Wall Street as it undercut prices for stocks and other investments.