Stocks rebound, shrug off Fed’s interest rate hike

STOCKS rose Thursday, shrugging off the sour mood surrounding the US Federal Reserve’s announcement that it was raising interest rates yet again and likely keeping them high for the foreseeable future. The 30-company Philippine Stock Exchange index climbed 77 points, or 1.18 percent, to close at 6,684.35, as all six subsectors advanced, led by property shares.

The broader all-share index went up 28 points, or 0.81 percent, to settle at 3,553.64 on a value turnover of P4.54 billion. Losers edged gainers, 97 to 96, while 45 issues were unchanged.

Eight of the 10 most active stocks ended in the green, led by PLDT Inc. which climbed 4.59 percent to P1,254.00 and Ayala Land Inc. which rose 4.56 percent to P28.65.

The peso was barely moved Thursday to close at 55.35 against the US dollar.

Meanwhile, all three major US indices declined along with the dollar after the Fed’s hike, while recession worries drove US oil prices below $70 a barrel, where they remained on Thursday.

But Hong Kong bucked the slide on Wall Street to finish with solid gains of nearly 1.3 percent, even as its de facto central bank moved to boost rates in line with the Fed.

While Shanghai also rose, Chinese shares overall see-sawed throughout the day, with the CSI

300 index ultimately finishing flat amid concerns over an uneven economic recovery.

Taipei, Wellington, Mumbai, Jakarta and Singapore were all up, while Sydney was slightly down and Seoul was flat. Tokyo was closed for a holiday.

Attention now shifts to Thursday’s meeting of the European Central Bank, which is expected to deliver another rate increase of its own.

London, Paris and Frankfurt were all down in early trade.

Meanwhile, fears of widespread banking turmoil were revived on Thursday as shares of regional US lender PacWest plummeted by more than half in after-hours trading.

The selloff was apparently spurred by reports the bank was considering the possibility of a sale or other capital-raising measures in the wake of the recent collapses of other mid-size lend-

ers, which had first sparked for the health of the sector.

PacWest sought to reassure investors in a statement, insisting it had not “experienced out-of-the-ordinary deposit flows” since the banking fears first arose, and that its “cash and available liquidity remains solid”.

The bank said it was routine to “continuously review strategic options”, adding it had been “approached by several potential partners and investors”.

But Tim Waterer, chief market analyst at KCM Trade, told Bloomberg that investors were unlikely to be convinced, adding that “there is nothing to suggest that the banking crisis is at an end”.

Oil, meanwhile, was still down on Thursday after taking a hit over fears of weaker demand due to an economic slowdown.

US benchmark WTI was trading below $70 a barrel in the afternoon after previously hitting its lowest price since OPEC+ cut output a month ago.

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