Rate cut hopes fuel PSEi comeback

The local bourse bounced back on Wednesday as investors priced in the possibility of a rate cut at the Bangko Sentral ng Pilipinas’ upcoming meeting.

By the end of the session, the benchmark Philippine Stock Exchange Index (PSEi) had rallied by 2.08 percent or 128.1 points to barrel past the 6,200 barrier. It closed at 6,273.34.

Likewise, the broader All Shares Index gained by 1.26 percent or 46.52 points to end at 3,731.07.

A total of 890.27 million shares worth P8.65 billion changed hands, stock exchange data showed. Foreigners, however, opted to shed their shares as outflows totaled P41.42 million.

Japhet Tantiangco, research head at Philstocks Financial Inc., said the bourse’s fierce comeback came as traders looked forward to a rate cut. The BSP is set to announce its monetary policy stance after the market closes on Thursday, Aug. 28.

At the same time, bargain hunters gobbling up lower-priced stocks provided a boost.

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Banks saw a steep climb as the sector is expected to see stronger loan demand should the BSP decide to slash benchmark interest rates.

BDO Unibank Inc. was the most actively traded stock as it surged by 6.86 percent to P140.20 each, followed by International Container Terminal Services Inc., up 7.02 percent to P485; Ayala Land Inc., up 2.11 percent to P29.10; SM Investments Corp., down 1.23 percent to P760.50; and Ayala Corp., up 0.36 percent to P565 each.

Gainers edged out losers 117 to 100, while 39 companies closed flat, stock exchange data also showed.