Share prices ended flat Thursday bucking negative sentiments after the Bangko Sentral ng Pilipinas (BSP) announced a surprise rate hike, raising the country’s overnight lending rate to 3.25 percent.
The peso edged higher. The Philippine Stock Exchange index (PSEi) was down 0.12 percent or 7.24 points to 6,248.13.
The broader all shares index was down 0.22 percent or 7.57 points to 3,367.
Losers edged gainers 124 to 69 with 34 stocks unchanged. Trading turnover reached $5.3 billion.
The peso closed at 56.15 to the dollar, up from 56.26 on Wednesday.
The currency opened at 56.30 and hit a high of 55.98 and a low of 56.45. Trading turnover reached $1.66 billion.
Currencies in the Philippines and Singapore rose on Thursday, as central banks in the regions unexpectedly tightened their policies to combat inflationary pressures and significant currency depreciation, Reuters reported.
The peso strengthened 0.3 percent, but was still near the record low it hit against the US dollar earlier this week.
“While the BSP does not target a particular level of the currency, it has been highlighting that it gets concerned about the currency when the depreciation affects the bank’s inflation targeting mandate,” Shreya Sodhani, research analyst at Barclays Bank said in a note.
The peso is among the worst performing currencies in Asia this year. Inflation, which surged to the highest level in nearly four years in June, is expected to remain elevated.
“The fact is that moves from Asian central banks are in response to upside inflation risks, but the timing and size of the moves are also aimed at ensuring their currencies don’t continue to weaken too fast,” said Khoon Goh, head of Asia research at ANZ.
Luis Limlingan, managing director at Regina Capital and Development Corp., said the market traded mostly in the red before finishing flat following the BSP’s surprise rate hike.
“For a substantial part of trading, the PSEi was down more than 1 percent as analysts became worried about the impact of a US recession,” he said.
Most actively traded Ayala Land Inc. was down P0.60 to P23.80. SM was down P21.50 to P775.50. International Container Terminal Services Inc. was up P3.70 to P186.50. Universal Robina Corp. was down P1.80 to P115. SM Prime Holdings Inc. was down P0.20 to P36.70.
BDO Unibank Inc. was up P3.10 to P123. Ayala Corp. was up P1 to P605. Metropolitan Bank and Trust Co. was up P0.05 to P47.70. GT Capital and Development Corp. was down P23 to P440. Semirara Mining and Power Corp. was up P0.50 to P39.
