MIXED. The local bourse's main index on Friday (March 24, 2023) ended the week up even after the 25 basis points increase in the Federal Reserve's key rates. On the other hand, the peso ended the day sideways due to correction and the key rate hikes by several central banks. (PNA graphics)

MANILA – Local shares mostly rallied on Friday after the 25 basis points increase in the Federal Reserve’s key rates on Thursday while the peso ended the week sideways against the United States dollar.

The Philippine Stock Exchange index (PSEi) rose by 1.01 percent, or 65.81 points, to 6.602.17 points.

All Shares gained 0.69 percent, or 23.95 points, to 3,516.72 points.

Most of the sectoral indices also ended the week up, led by Services after it increased by 2.33 percent.

It was followed by Holding Firms, 1.14 percent; Industrial, 0.92 percent; Property, 0.39 percent; and Financials, 0.15 percent.

Only the Mining and Oil index ended the week in the negative territory after it fell by 0.24 percent.

Volume reached 627.06 million shares amounting to PHP4.68 billion.

Advancers led decliners at 102 to 82 while 43 shares were unchanged.

“Philippines shares retested the 6,600 level, once more closing in the green as investors continued to respond on the 25 bp (basis points) rate adjustment announced by the Fed on Wednesday,” said Luis Limlingan, Regina Capital Development Corp. head of sales.

He also cited the Fed’s statement that its fight against the elevated inflation rate is nearing its end.

On the local front, Limlingan attributed the bargain hunting in the local bourse to the 25 basis points increase in the Bangko Sentral ng Pilipinas’ (BSP) key rates on Thursday, which brought the total increase in its key rates to 425 basis points since May 2022.

Oil prices fell in the international market to USD75.91 per barrel for the Brent crude and to USD69.96 per barrel for the West Texas Intermediate (WTI) “after US Energy Secretary Jennifer Granholm told lawmakers that refilling the country’s SPR (Strategic Petroleum Reserve) may take several years.”

Meanwhile, the peso ended the day sideways against the US dollar and finished the week at 54.35 from the previous session’s 54.27.

It opened the day at 54.36 and traded between 54.42 and 54.22, for an average of 54.32.

Volume reached USD1.04 billion, down from USD1.14 billion a day ago.

Rizal Commercial Banking Corp. chief economist Michael Ricafort said the local currency posted a correction due in part to the improvement of the US dollar, the gains in the US stock markets, the statement by US authorities regarding measures being put in place to address banking issues, and the key rates hikes by the US Federal Reserve, Bank of England (BoE), Norway’s Norges Bank, and the Swiss National Bank.

Ricafort said these factors are countered partly by the statement of Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla that the domestic inflation rate is expected to return to within the government’s 2 percent to 4 percent target range by October this year.

Medalla said domestic banks remain resilient to the development of their counterparts overseas and the central bank would continue to be watchful of global developments.

For next week, the local currency is expected to trade between 54.10 and 54.60 against the greenback while the projected range for Monday is between 54.25 and 54.45. (PNA)