• PH stock market cheers Fed rate freeze

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    EQUITY prices traded on a buoyant note Thursday after the US Federal Reserve decided to keep interest rates unchanged in the world’s largest economy.

    The bellwether PSEi returned to the 7,700-point territory, rising for the fourth successive trading day. It rose by 1.13 percent or 86.93 points to close at 7,762.35. The wider All Shares advanced by 0.72 percent or 32.71 points to 4,603.05.

    “The market uptick is really more of a reaction to the announcement of the Fed,” Astro del Castillo, managing director at First Grade Finance Inc., said in a phone interview.

    RCBC Securities Inc. Research analyst Anton Alfonso echoed the market’s sentiment, saying transactions showed an upward bias, given the rally overnight on Wall Street after the Fed left its policy rates unchanged.

    Fed chair Janet Yellen announced at the conclusion of a two-day meeting that there will be no rate hike this month, but maybe toward the end of the year.

    Del Castillo said the move was expected due to the prevailing “hiccups” in the US economy. “It’s okay. Not much excitement, because this is expected of them. There are still a lot of hiccups in the US economy.

    “December is still an alternative time for the interest rate hike,” del Castillo said.

    “But hopefully, foreign funds will get back to emerging markets like the Philippines after the Fed kept rates unchanged,” he added.

    For his part, Gerard Barbosa, trader at AP Securities Inc., said the Fed rate hike is likely to occur “late in the year—this December.”

    But Barbosa is keeping a cautious eye on the market. The “local market was up as investors were again bullish on emerging markets as a sudden sizable flight-to-safety move by foreign capital remained out of the picture.”

    “But again, this may just be a chance to sell as a real bullish catalyst is hard to come by at this point for the index,” Barbosa said.

    “Traders should become more cautious … as bias turns in favor of the bears,” he added, citing market remains in a corrective posture.

    More than 1.05 billion shares were traded, valued at P8.48 billion. Gainers outnumbered losers, 109 to 66, while 45 issues were unchanged.

    On Wednesday, the benchmark PSEi inched up 0.05 percent or 3.70 points to 7,675.42. The wider All Shares index rose 0.15 percent or 6.79 points to 4,570.34.

     

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