PSEi nears 8,000; Fed move cheered
Credit to Author: AGENCE FRANCE-PRESSE| Date: Thu, 21 Mar 2019 16:20:01 +0000
THE stock market rallied to a nearly one-month high on Thursday as investors cheered news that the US Federal Reserve would likely not raise rates this year.
The benchmark Philippine Stock Exchange index (PSEi) rose by 1.23 percent or 96.52 points to finish at 7,954.72 — a level last seen on February 26 when the market closed at 7,988.16.
The wider All Shares grew by 0.85 percent or 41.30 points to end at 4,888.79.
Regina Capital Development Corp. head of sales Luis Limlingan said market players bought shares after the Fed’s policymaking Federal Open Market Committee (FOMC) indicated that further rate hikes were unlikely given slower US growth.
The announcement took markets by surprise, with most observers expecting the Fed would tee up at least one rate hike this year, and fueled concerns about the state of the economy.
US stocks initially rallied shortly but later pulled back. In the end, both the Dow and S&P 500 finished in the red while the Nasdaq eked out a narrow gain.
Briefing.com analyst Patrick O’Hare described the market’s initial surge as a knee-jerk reaction to a dovish central bank that investors later rethought.
The Fed’s dovishness “invites some concerns about what it really implies about the global economic outlook,” O’Hare said, adding that it raises the possibility “that US economy will disappoint”.
Most stock markets in Asia rose, however, with Shanghai 0.4 percent higher while Singapore added 0.2 percent. Sydney, Taipei, Bangkok and Jakarta also rose though
Hong Kong reversed course in the afternoon to close 0.9 percent lower.
Tokyo was closed for a holiday.
In early European trade, London was up 0.2 percent, Paris slipped 0.1 percent, while Frankfurt was down 0.3 percent.
In Manila, all sectoral indices finished in the green with the holding firms up the most by 2.22 percent.
More than 1.38 billion shares valued at P5.39 billion were traded Winners led losers, 124 to 76, while 42 issues were unchanged.
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