MANILA – Local shares recovered on Tuesday amid the wait-and-see mode ahead of the Federal Reserve’s policy rate decision announcement, while the peso improved against the US dollar.
The Philippine Stock Exchange index (PSEi) gained 0.22 percent, or 13.47 points, to 6,223.00 points.
All Shares followed with a jump of 0.16 percent, or 5.22 points, to 3,364.99 points.
Most of the sectoral indices also increased during the day – Holding Firms, 0.71 percent; Services, 0.69 percent; Industrial, 0.45 percent; and Mining and Oil, 0.24 percent.
On the other hand, Property slipped by 0.89 percent and Financials by 0.003 percent.
Volume reached 728.03 million shares, amounting to PHP3.75 billion.
Gainers led losers at 104 to 74, while 47 shares were unchanged.
Luis Limlingan, Regina Capital Development Corporation (RCDC) head of shares, said among the factors that contributed to investors’ sentiments during the day include the anticipation for another hike in the Federal Reserve’s key rates after the Federal Open Market Committee’s (FOMC) meeting from July 26-27.
“Traders anticipate a three-quarter percentage point increase,” he said.
The Federal Reserve’s funds rate has been increased by a total of 150 basis points so far this year to help tame the accelerating inflation rate in the US, which rose to another four-decade high of 9.1 percent last June.
Limlingan also cited as a plus to investors’ sentiment the pronouncement of President Ferdinand Marcos Jr. in his first State of the Nation Address (SONA) on Monday to impose value added tax (VAT) on digital services.
He said the measure is expected to raise around PHP11.7 billion worth of revenues if implemented by 2023.
“Business groups are welcoming of this idea, saying that this would bring online merchants on equal footing with physical retailers on tax burdens,” he said.
Meanwhile, the local currency ended the day at 55.3 against the US dollar, an appreciation from its 56.1 close a day ago.
Its strength showed early on after opening the day at 55.85 from Monday’s 56.2 start.
It traded between 55.88 and 55.29, bringing the day’s average to 55.647.
Volume reached USD1.43 billion, almost twice the USD722.2 million a day ago. (PNA)