Share prices ended higher Monday after it was reported the economy expanded by 7.4 percent in the second quarter.
The Philippine Stock Exchange index (PSEi) was up 34.73 points, or 0.54 percent to 6,468.97.
The broader all shares index was up 7.71 points, a 0.22 percent hike to 3,456.44.
Gainers edged losers 112 to 82 with 42 stocks unchanged. Trading turnover reached P12.19 billion.
The peso closed at 55.595 to the dollar, down from 55.55 on Monday.
The currency opened at 55.45 and hit a high of 55.40 and a low of 55.66. Trading turnover reached $1.36 billion.
In the region, Asian currencies were subdued on Tuesday, as the US dollar remained flat ahead of July inflation data, while the baht scaled to a five-week high with investor focus on a central bank meeting that is expected to kick-start Thailand’s tightening cycle, Reuters reported.
The US dollar index remained flat ahead of inflation data due later in the week.
Claire Alviar, analyst at Philstocks Financial Inc. said investors lauded the reported 7.4 -percent expansion of the economy in the second quarter, which fell within the government’s target of 6.5 to 7.5 percent.
Market observers said this gives the Bangko Sentral ng Pilipinas (BSP) a wiggle room to raise rates. With inflation near a four-year high, the market is widely expecting a bigger hike on August 18 by the BSP.
Analysts at Goldman Sachs, ING and Barclays expect a 50-basis point hike by BSP.
Analysts at ING expect the BSP to maintain its hawkish bias for the rest of the year.
“We believe, however, BSP may dial down the magnitude of tightening, resorting to 25-bps rate hikes for the remainder of the 2022 policy meetings,” ING analysts said in a note.
The BSP’s 125-basis-points cumulative hike since the start of the year has helped stabilize the peso, which lost more than 6 percent in the previous quarter.
“Moreover, oil price rollback and lower electricity rates this August provide optimism as it may downwardly pressure the inflation rate” she said.
Most actively traded Ayala Land Inc. was up P1.15 to P26.35. International Container Terminal Services Inc. was down P3 to P181. BDO Unibank Inc. was up P2.90 to P115. SM Investments Corp. was up P27 to P805. Ayala Corp. was down P7 to P708. Manila Electric Co. was down P4.80 to P315. Universal Robina Corp. was up P0.50 to P124.50. Monde Nissin Corp. was down P0.04 to P16.08. SM Prime Holdings Inc. was up P0.70 to P37.30. Semirara Mining and Power Corp. was steady at P39.50.
