Share prices are expected to move sideways this week ahead of the Monetary Board’s sixth policy review meeting scheduled on Sept. 26.
Analysts are expecting the Bangko Sentral ng Pilipinas to announce another 25-basis point reduction in benchmark interest rates based on previous statements of BSP Governor Benjamin Diokno.
The US Federal Reserve last week cut interest rates by 25 basis points to boost the American economy.
The BSP since the start of the year has reduced the benchmark interest rates by a total of 50 bps, lowering rates for overnight reverse repurchase, overnight deposit and overnight lending to 4.25 percent, 3.75 percent and 4.75 percent, respectively.
Investors will also monitor the rebalancing of the Financial Times Stock Exchange that takes effect Monday.
With the FTSE rebalancing overhang over, the next catalyst next week should now be the BSP’s policy decision. Consensus expects the central bank to cut by 25bps,” Gabriel Perez, a trader from Papa Securities, said.
The Philippine Stock Exchange Index last week declined 1.5 percent to 7,871.11 points, while the broader All Shares Index fell 1 percent on geopolitical tensions in the Middle East.
All major sub-indices ended in red, led by mining and oil which dropped 2.3 percent, financials which declined 2.5 percent and services which decreased 2.1 percent.
The property index lost 1.9 percent, followed by holding firms and industrial, which slipped 0.9 percent and 0.7 percent, respectively.
Foreign investors were net sellers for the week by P1.75 billion, while the average daily value traded stood flat at P6.2 billion.
Weekly top price gainers were mostly third-liners led by Phinma Corp., which rose 30.6 percent to P12; D.M. Wenceslao & Associates Inc., which rose 5.2 percent to P9.83; and Starmalls Inc., which advanced 3.6 percent to P5.99.
Weekly top price losers were Megaworld Corp., which declined 4.8 percent to P4.92; First Gen Corp., which dipped fell 4.8 percent to P24.80; and PLDT Inc., which dropped 4.7 percent to P1,147.
Meanwhile, a rally on hopes for progress in the US-China trade war fizzled late Friday, sending Wall Street into the red after bourses elsewhere had drifted higher earlier in the day.
A delegation of Chinese officials on Friday abruptly canceled hastily-scheduled visits to farms Nebraska and Montana.
While mid-level trade talks continued uninterrupted in Washington, the visits’ sudden cancelation spooked investors on Wall Street, sending all three major indices in the red.
US stocks fell for the week after three straight weeks of gains.
Earlier in the day, reports that President Donald Trump was exempting hundreds of Chinese imports from tariffs imposed last year had lifted spirits in Frankfurt, Paris and Shanghai.
The results capped a tumultuous week during which attacks on Saudi oil facilities sent oil prices skyrocketing, and investors reacted ambivalently to a widely-anticipated interest rate cut by the US central bank. With AFP
