PH shares to take cue from inflation, tariffs

Inflation data and tariff uncertainties will likely take the spotlight at the local bourse this week, along with potential late reactions to the Bangko Sentral ng Pilipinas’ (BSP) recent rate cut.

Trading platform 2TradeAsia.com said in an advisory over the weekend the impact of new US tariffs on several of its trade partners would impact global supply chains, “which could exacerbate unwelcome inflation volatility globally.”

Last week, US President Donald Trump threatened China with a 200-percent tariff if it did not export rare earth magnets to the United States.

This caused markets across the globe to react negatively, with the local stock barometer dipping to a four-month low early in the week.

The Philippine Stock Exchange Index (PSEi) again succumbed to profit-taking as it fell 2.01 percent to close the week at 6,155.

Despite the BSP’s move to slash the benchmark rate for overnight borrowing by another 25 basis points to 5 percent on Thursday, investors remained unmoved.

Luis Limlingan, head of sales at stock brokerage house Regina Capital Development Corp., earlier said traders were likely looking for a stronger catalyst.

For now, it would be the release of the August inflation print on Friday.

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Analysts have pegged inflation to have finished faster last month because of higher electricity and transport costs, as well as an increase in vegetable prices.

Still, 2TradeAsia said domestic inflation “appears benign for now,” and that external risks may still play a big role at the market.

It sees the index’s immediate support at 6,200 and resistance at 6,500 this week.