Interest rate woes dampen stock market

MANILA, Philippines — Share prices plunged for a fourth consecutive session on investor concerns over the direction of interest rates.

The Philippine Stock Exchange index ended the week on a sour note, dropping by 0.11 percent or 7.13 points at 6,383.70.

The broader All Share index, on the other hand, inched up by 0.14 percent or 4.75 points to settle at 3,447.75.

Claire Alviar of Philstocks Financial said the local bourse declined as investors took more gains, while others chose to stay on the sidelines ahead of the long weekend.

Alviar said uncertainty over the direction of the Philippine interest rates in the near term provided negative sentiment following remarks of Finance Secretary Ralph Recto that the Bangko Sentral ng Pilipinas (BSP) may only ease monetary policy after the Federal Reserve makes the first cut.

Alviar said this could mean that the current high interest rates may stay longer than anticipated.

“The local bourse ended the week in the red as investors digested the latest statements from the BSP regarding potential rate cuts,” Luis Limlingan of Regina Capital said.

“Finance Secretary Ralph Recto anticipates more than one rate cut this year, likely following the Fed’s expected policy easing. The BSP indicated it would consider inflation and the interest rate differential between the Fed and domestic rates before making any cuts,” he said.

Net market value turnover thinned to P2.97 billion from the previous day’s P4.74 billion.

Only two sectors were in the green–financials and property which climbed by 0.58 percent and 0.33 percent, respectively.

Mining and oil, meanwhile, took the biggest fall at 1.19 percent.

Decliners edged out advancers, 94 to 84, while 57 issues were unchanged.

Converge ICT Solutions led the index members with a 2.55 percent increase, while Century Pacific Foods Corp. had the largest loss at 3.14 percent