PHILIPPINE shares fell in early trading Wednesday as the local market tracked the sell-off on Wall Street amid fears of more rate hikes this year than expected.
The benchmark Philippine Stock Exchange index (PSEi) was down 89.06 points or 1.04 percent at 8,503.32 at the noon break while the broader All Shares was down 34.20 points or 0.67 percent at 5,084.32.
“The PSEi was tracking the US sell-off following Federal Reserve chairman Jerome Powell’s comments that spurred market speculations of possible faster rate hikes,” IB Gimenez Securities, Inc. research head Joylin Telagen said.
This was echoed by China Bank Securities Corp. Research Director Garie Ouano, who said the local market is likely pricing in a faster pace of rate hikes.
“Estimates were previously torn between two to three hikes and three to four, but Powell’s remarks last night could have tilted sentiment toward a faster pace. This is especially relevant considering his previous support for [former US Federal Reserve chairman Janet]Yellen’s gradual approach,” he said.
Powell suggested Wednesday that the US central bank could increase its key interest rates faster than anticipated.
Among the sectoral indices, only the mining and oil index ended the morning session higher, up 0.77 percent, while the rest were in the red. ANGELICA BALLESTEROS