Stocks jump ahead of Federal Reserve’s review

STOCKS jumped on Monday as investors awaited the US Federal Reserve’s policy meeting this week.

The 30-member Philippine Stock Exchange index firmed up 0.95% or 74.74 points to close at 7,873.02, reversing the losses seen in morning trading. The broader all-shares index likewise gained 0.67% or 32.39 points to 4,845.42.

“The Fed watch, US-China trade news kept the market cautiously at bay this week as investors carefully bought into selective names today,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message on Monday.

Eagle Equities, Inc. Research Head Christopher John Mangun noted the same, saying the index ended higher alongside other Asian markets.

“Asian equities pulled ahead today on the growing speculation that the US Federal Reserve will sound dovish at its policy meeting this week,” Mr. Mangun said in an e-mail on Monday.

Analysts expect the US Federal Reserve to cut their interest rate forecasts this year, which means little to no further tightening in 2019. The US central bank’s twoday policy meeting will start on March 19.

The Fed’s policy meeting will be followed by the Bangko Sentral ng Pilipinas’ Monetary Board’s own review on Thursday.

A BusinessWorld poll showed 10 of 13 economists predicting that the Monetary Board will keep benchmark interest rates steady on Thursday as headline inflation has been declining in the previous months.

Mr. Mangun added that seeing as the index closed near the 7,900 resistance level, it may bounce off and edge lower on Tuesday.

“However, a break above 7,900 is bullish and may give investors some optimism. Trading volumes are still below average,” he said.

The PSEi also trailed off Wall Street’s advance last Friday. The Dow Jones Industrial Average climbed 0.54% or 138.93 points to 25,848.87. The S&P 500 index rose 0.5% or 14 points to 2,822.48, while the Nasdaq Composite index increased 0.76% or 57.62 points to 7,688.53.

Back home, services was the lone sector that ended in negative territory, dropping 0.25% or 4.08 points to 1,575.

The rest went up, led by mining and oil which soared 1.37% or 111.60 points to 8,247.37. Holding firms rose 1.33% or 102.17 points to 7,775.64; property gained 1.11% or 44.06 points to 4,013.95; financials increased 0.75% or 13.28 points to 1,784.09; while industrials added 0.66% or 77.33 points to 11,633.66.

Some 1.70 billion issues valued at P5.32 billion switched hands, significantly lower than Friday’s P20.79-billion turnover.

Advancers outpaced decliners by a hair, 94 to 93, while 54 names were unchanged.

Foreign investors remained net buyers at P406.76 million, although lower than the previous session’s net purchases worth P1.81 billion. By Arra B. Francia Reporter