PSEi dips ahead of US inflation data

THE stock market seesawed down on Tuesday as investors moved cautiously ahead of the release of to dictate the Federal Reserve’s next interest rate move.

The benchmark Philippine Stock Exchange index (PSEi) fell by 0.40 percent or 33.93 points to end at 8,419.57 while the wider All Shares dipped 0.33 percent or

“Most investors are playing it safe ahead of the announcement [ figures],” First Grade Finance, Inc. Managing Director Astro del Castillo said in a phone interview.

“These are the major factors. Inflation could dictate whether the Fed will raise interest rates although it seems like it is already a foregone conclusion that the Fed will tighten,” he added.

Late last month, Fed Chairman James Powell suggested a fasterthan-expected pace of interest rate hikes as the US economy continued to accelerate, prompting a global sell-off.

In a separate comment, China Bank Securities Corp. research director Garie Ouano said the local market was only “technically correcting” following a rally on Monday.

“Probably just a technical selloff since there was no negative market-moving news today. Value turnover was below average and the index is also near its 100-day exponential moving average,” Ouano noted.

The PSEi’s rise on Monday was driven by gains on Wall Street, which took heart from strong US jobs data and news that US President Donald Trump would be meeting with North Korean leader Kim Jong Un.

Tuesday’s dip came as most Asian markets rose with Tokyo, Hong Kong and Seoul among the gainers.

Locally, most sectoral indices were in the red except holding 0.15 percent and 0.30 percent, respectively.

Volume turnover was thin at 4.85 billion issues valued P6.56 billion.

Decliners led advancers, 123 to 84, while 52 issues were unchanged.