PSEi slips on profit taking, central bank decision

THE MAIN INDEX closed lower on Thursday amid last-minute profit taking after the Bangko Sentral ng Pilipinas (BSP) kept rates untouched at its policy review, as expected by the market.

The bellwether Philippine Stock Exchange index (PSEi) slipped by 6.47 points or 0.09% to close at 6,628.64 on Thursday, while the broader all shares index inched up by 0.80 point or 0.02% to end at 3,534.64.

“After two consecutive days of market rally, the local bourse fell by 6.47 points to 6,628.64 due to last-minute profit taking, Philstocks Financial, Inc. Research Analyst Claire T. Alviar said in a Viber message.

“Meanwhile, market sentiment did not get a boost from the decision of the Bangko Sentral ng Pilipinas as investors had already factored in the pause in interest rate hikes,” Ms. Alviar added.

AB Capital Securities, Inc. Vice-President Jovis L. Vistan said in a Viber message likewise said stocks were stagnant during the day as investors stayed on the sidelines ahead of the BSP’s policy decision.

“Throughout the day, share prices experienced a modest rise,” Mr. Vistan added.

The BSP on Thursday kept benchmark interest rates unchanged in a “prudent pause” as it sees inflation returning within its target band by the fourth quarter, even as price pressures remain tilted to the upside.

The policy-setting Monetary Board kept the key rate or the interest rate on the BSP’s overnight reverse repurchase facility at 6.25%.

Rates on the overnight deposit and lending facilities were likewise untouched at 5.75% and 6.75%, respectively.

The central bank paused for the first time after hiking in nine straight meetings, raising borrowing costs by a total of 425 basis points from May 2022 to March 2023.

Headline inflation slowed to an eight-month low of 6.6% in April. For the first four months of the year, the consumer price index averaged 7.9%, still well above the BSP’s 2-4% target for 2023.

All sectoral indices went up on Wednesday, except for holding firms, which fell by 44.08 points or 0.66% to end at 6,562.66.

Meanwhile, mining and oil rose by 104.68 points or 1.03% to 10,247.05; industrials increased by 40.32 points or 0.42% to 9,508.96; property gained 5.94 points or 0.21% to end at 2,750.28; services added 1.27 points or 0.08% to close at 1,580.49; and financials went up by 0.82 point or 0.04% to 1,854.17.

Advancers outnumbered decliners, 90 versus 81, while 61 names closed unchanged.

Value turnover fell to P3.96 billion on Thursday with 729.91 million shares changing hands from the P4.34 billion with 1.07 billion issues traded on Wednesday.

Net foreign selling stood at P244.47 million on Thursday versus the P153.35 million in net buying seen on Wednesday. — A.H. Halili