Share prices closed higher on Tuesday as investors priced in expectations that June inflation will remain manageable despite projections of a likely uptick from the 1.3 percent rate recorded in May.
The benchmark PSEi gained 58.91 points or 0.93 percent to close at 6,423.85, while the broader All Shares rose 17.69 points or 0.47 percent to 3,799.36.
June inflation figures are due out Friday, July 4. Investors are anticipating that the rate, while higher than May’s near six-year low, will stay within the Bangko Sentral ng Pilipinas’ 2 to 4 percent target range.
Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said this could leave room for further monetary easing in the coming months.
“With inflation likely to remain below target, the BSP may still consider another 25-basis-point rate cut before year-end,” Ricafort said.
Market sentiment also improved on continued foreign fund inflows. Net foreign buying hit P969.71 million, with total purchases at P3.62 billion versus P2.65 billion in sales.
Japhet Tantiangco, research manager at Philstocks Financial Inc., said optimism was also fueled by the peso’s strength against the US dollar, which could ease import costs and support inflation control.
Tantiangco agreed: “The local market bounced back amid expectations that inflation this June had remained well under control despite certain upside risks.”
Gainers outpaced losers, 115 to 79, while 65 issues were unchanged. Turnover reached P7.69 billion across 76,844 trades, involving 1.35 billion shares.
