Stocks rebound ahead of Holy Week break

April 13, 2022

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SHARES went up on Wednesday as investors chose to maintain their positions ahead of the Holy Week break and despite data showing US inflation hit a 16-year high last month.

The benchmark Philippine Stock Exchange index (PSEi) gained 89.54 points or 1.29% to close at 6,984.90 on Wednesday, while the broader all shares went up by 40.74 points or 1.10% to close at 3,726.58.

“Investors returned to the Philippine market as they stayed away from other regions that have seen their inflation numbers continue to increase. Wall Street continued to tumble on Tuesday as US inflation spiked to 8.5%, the highest since 1981, further fueling concerns about tighter monetary policy from the Fed (US Federal Reserve),” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

US consumer prices increased by the most in 16 and a half years in March as Russia’s war against Ukraine boosted the cost of gasoline to record highs, cementing the case for a 50-basis points interest rate hike from the Federal Reserve next month, Reuters reported.

The US consumer price index increased 8.5% year on year, with March advancing by 1.2%, the biggest monthly gain since September 2005.

US central bankers are split on whether high inflation will be a recurring problem in the future requiring repeated rate hikes, comments from two officials showed on Tuesday, a stark contrast to their broad consensus on the current policy path.

Separate remarks from Federal Reserve Governor Lael Brainard and Richmond Fed President Thomas Barkin on the post-pandemic outlook showed an emerging rift in the views of Fed leaders, who all currently see the need to raise interest rates aggressively this year.

Meanwhile, Timson Securities, Inc. Trader Darren Blaine T. Pangan said the PSEi rose as investors chose to maintain their positions ahead of the Holy Week break.

“The market is higher but on very thin volume most likely as investors are already on holiday break,” COL Financial Group First Vice-President April Lynn C. Lee-Tan added in a Viber message.

Philippine financial markets are closed from April 14-15 in commemoration of Maundy Thursday and Good Friday, respectively. Trading will resume on April 18, Monday.

All sectoral indices ended in the green on Wednesday. Industrials climbed by 219.01 points or 2.32% to 9,633.81; services rose by 23.66 points or 1.24% to 1,927.11; property gained by 36.95 points or 1.16% to 3,221.44; holding firms added 69.43 points or 1.06% to close at 6,570.64; financials went up by 7.24 points or 0.44% to 1,653.45; and mining and oil increased by 45.18 points or 0.37% to 12,217.61.

The MidCap index advanced by 7.68 points or 0.66% to 1,173.69 and the Dividend Yield index added 17.37 points or 1.05% to close at 1,676.36.

Value turnover decreased to P4.21 billion with 1.42 billion shares changing hands from P5 billion with 1.51 billion issues seen on Tuesday.

Advancers outnumbered decliners, 100 versus 66, while 54 names closed unchanged.

Net foreign selling declined to P294.89 million on Wednesday from P749.76 million the previous trading day. — Luisa Maria Jacinta C. Jocson with Reuters