Investors cheer inflation news as rate cut odds increase

Philippine stocks rose after the December inflation print fell within the government’s target range after almost two years, with pundits believing the country may begin lowering interest rates by the second half of the year. The benchmark Philippine Stock Exchange Index (PSEi) rose 0.41 percent, or 27.12 points, to 6,629.64 while the broader All Shares index added 0.48 percent, or 16.76 points, to 3,502.52. Data from the Philippine Statistics Authority showed inflation easing to 3.9 percent in December from 4.1 percent the previous month. This was lower than the average forecast of 4 percent, COL Financial Group chief equity strategist April Lynn Tan said. Metropolitan Bank & Trust Co. (Metrobank) said the latest consumer price data raised the likelihood of an interest rate cut as early as June this year.

“We think that policy rates may not need to be as restrictive as current levels throughout the year, especially if core inflation continues to move lower,” Metrobank’s research and analytics department noted.

Financials up

Meanwhile, PSE data showed 520.2 million shares valued at P5.26 billion changing hands while foreigners were mostly buyers for a net amount worth P420.6 million.

PSE subsectors were mixed. Financials, industrial and holding firms advanced, while property, services and mining and oil retreated.

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Ayala Land Inc. was the top traded stock as it slipped 1.44 percent to P34.30 per share. It was followed by SM Prime Holdings Inc., down 1.78 percent to P33.10; BDO Unibank Inc., up 1.91 percent to P133.10; International Container Terminal Services Inc., down 1.33 percent to P252; and Universal Robina Corp., up 1.15 percent to P123.40 per share.

Overall, there were 124 winners agaWinst 55 losers while 49 companies closed unchanged, data from the stock exchange showed. INQ