BSP’s next policy rate move seen shaping stocks direction

Investors are expected to take their cue from possible hints about the Bangko Sentral ng Pilipinas’ (BSP) next policy meeting. Ditto with the upcoming index rebalancing in steering the local bourse this week.

Wendy Estacio-Cruz, research head at Unicapital Securities Inc., said the rate-setting meeting would be a “key domestic catalyst.”

The BSP is set to announce its next monetary policy stance on Aug. 28.

So far, BSP Governor Eli Remolona Jr. has hinted at two more rate cuts this year, citing easing inflation.

At the same time, Luis Limlingan, head of sales at stock brokerage house Regina Capital Development Corp., said the Philippine Stock Exchange Index (PSEi) rebalancing — which takes effect on Monday, Aug. 18 — may influence the market.

To recall, the PSE kicked out Bloomberry Resorts Corp. and brought in DigiPlus Interactive Corp.. This, despite the latter’s share price having been recently battered due to threats of an outright ban on online gambling.

Still, analysts said DigiPlus was able to make the cut because it had met the criteria within the evaluation period, which ended before the policy change was proposed.

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Last week, the benchmark PSEi closed lower by 0.37 percent week-on-week to 6,315.

It mostly moved sideways because of the lack of a catalyst, although it eventually ended lower as traders pocketed gains.

Cruz expects the bourse to move within the 6,300 to 6,500 levels this week.