Manila, Philippines – The Philippine Stock Exchange Index continued its rally today. The index closed at 7433.61, which is higher by 50.61 points or 0.69 percent.
The broader all-share index is higher by 0.54 percent.
Sub-indices were mixed today with the Financial, Holdings, Service, Mining and Oil sector closing high. Meanwhile, the Industrial and Property Sector closed low.
The best performing sector is the Financial sector — rising by 1.92 percent. It is then followed by the Mining and Oil, which rose by 1.77 percent.
Within the Financial sector, BPI led the sub-index higher as it closed at 88.20. This figure is higher by 5.13 percent versus yesterday’s close.
Moreover, MBT closed at 69.90, which is higher by 2.79 percent. BDO closed at 121.0, a 0.33 percent increase. SECB closed at 168.90– rising by 0.24 percent.
Within the Mining and Oil sector, SCC led the sub-index higher as it closed at 27.65. This figure is higher by 1.84 percent versus yesterday’s close.
Furthermore, PXP closed at 15.94, which is higher by 4.32 percent. NIKL closed at 1.39, an increase of 1.35 percent. APX closed at 1.51 with a 0.67 percent rise.
Which Stocks Traded the Largest Volume?
The most active stocks today include AEV with PHP 246.90 million in traded value. BPI made it to the top gainers with a traded value of PHP 222.24 million. BDO also had PHP 217.21 million in traded value.
Gainers and Losers for the Day
Significant gainers for the day include STI, which is higher by 25.00 percent; TUGS, by 11.46 percent; ECP, by 9.09 percent; AEV, by 7.46 percent; and, ISM, by 6.19 percent.
On the other hand, the notable losers include TECH, which was down by 6.58 percent, and OM — falling by 9.09 percent.
There were 95 advances and 97 declines, while 42 names remain unchanged. Value turnover totalled PHP 3.93 billion. Foreign exchange rate stood at USD 1: PHP 54.04.
Strong Rate Hike Expected
Analysts expect Bangko Sentral ng Pilipinas (BSP) to raise rates by at least 50 basis points this week.
The inflation assumptions were because of the storm ravishing the Northern part of the country last week. Some financial firms even expect inflation to reach as high as 7 percent.
The policy-setting Monetary Board will hold its sixth review this week specifically on September 27.
If BSP would indeed raise rates, this would be the 4th consecutive month of rate hikes and would bring yields to 4-5 percent.
The estimated agricultural damage of the storm is PHP 14 billion with most of the damage being in Benguet, Isabela, and Cagayan. It would most likely result in a new multi-year high on food prices.
Prior rate hike expectations before the storm were only 25 basis points, but this would be unlikely due to recent events.
The rate hike, together with OFW remittances in the last quarter, would most likely help in strengthening the Peso versus the Dollar.
The exchange was down by around 8 percent. It is now trading around the PHP 54.00 area.
On the flip side, the rate hike would lead to higher borrowing cost that may dampen demand for loans for business start-ups and expansions. If it occurs, it could result in a slowing of the economy.
Index Moves Higher
The index broke resistance today. The 15 EMA, however, is still acting as resistance.
Furthermore, the 20 SMA and 50 SMA may also act as resistance. The 50% Fibonacci line also served as resistance today while the 61.80 percent line at 7330 may act as support.
MACD is poised for a bullish crossover. RSI is also upbeat and is at neutral levels. Estimated support is at 7417 followed by 7242. Expected resistance is at 7627.
Foreign Fund Flow
PSEi registered a Net Foreign Selling worth P563,573,155.63 as of September 24, 2018. On a 30-day trading period, PSEi is on a Net Foreign Selling worth PHP15,559,369,972.10.
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