PHILIPPINE SHARES inched lower on Thursday as investors pocketed profits from the market’s recent rally in anticipation of the Bangko Sentral ng Pilipinas’ (BSP) policy decision, which was announced near the end of the trading session.
The Philippine Stock Exchange index (PSEi) dropped by 0.18% or 12.05 points to finish at 6,692.91 on Thursday, while the broader all shares index slipped by 0.03% or 1.15 points to close at 3,628.15.
“Last-minute profit taking brought the local market down. Investors booking gains is seen as a cautious move while waiting for the BSP’s policy decision,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message. “Chart-wise, the local market declined after hitting its resistance at the 6,700-6,800 range.”
“Philippine shares closed slightly lower as local traders anticipated the BSP’s policy decision. It was also announced a few minutes after closing that rates would finally be reduced by 25 bps (basis points) after much speculation from the market,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
The BSP’s policy-setting Monetary Board on Thursday cut benchmark interest rates for the first time in nearly four years amid expectations of easing inflation.
The central bank reduced its target reverse repurchase rate by 25 bps to 6.25%, as expected by nine out of 16 analysts in a BusinessWorld poll conducted last week. This marked its first easing move since November 2020.
Prior to the cut, the BSP kept its policy rate at an over 17-year high of 6.5% since October 2023 following cumulative hikes worth 450 bps to combat inflation.
“With inflation on a target-consistent path, the current macroeconomic outlook supports a calibrated shift to a less restrictive monetary policy stance. Nonetheless, monetary authorities remain mindful of lingering upside risks to prices,” BSP Governor Eli M. Remolona, Jr. said in a briefing on Thursday. “Going forward, the Monetary Board will continue to take a measured approach in ensuring price stability conducive to balanced and sustainable growth of the economy and employment.”
Majority of sectoral indices closed lower on Thursday. Mining and oil dropped by 1.11% or 91.22 points to 8,128.17; financials went down by 0.77% or 15.30 points to 1,969.35; holding firms retreated by 0.47% or 27.71 points to 5,761.03; and industrials declined by 0.18% or 16.97 points to 9,149.18.
On the other hand, services climbed by 0.68% or 14.26 points to 2,102.48, and property rose by 0.01% or 0.47 points to 2,694.38.
Value turnover went down to P5.5 billion on Thursday with 462.44 million shares switching hands from the P6.96 billion with 670.22 million issues traded on Wednesday.
Advancers beat decliners, 103 versus 98, while 47 issues ended unchanged.
Net foreign buying dropped to P3.58 million on Thursday from P457.52 million on Wednesday. — Revin Mikhael D. Ochave