Stocks halt rally on profit taking .  

Iris Gonzales - The Philippine Star
Stocks halt rally on profit taking  .  
This undated file photo shows the trading floor of the Philippine Stock Exchange.
PSE / Released

MANILA, Philippines — Local stocks bucked the uptrend in other emerging markets yesterday as the main index fell on profit taking, putting a stop to six straight sessions of gains. The Philippine Stock Exchange index (PSEi) opened December in the red, finishing at 6,734.99, down by 45.79 points or 0.67 percent. Likewise, the broader All Shares index slipped by 12.95 points or 0.36 percent to 3,501.03.

A total of P10.11 billion worth of shares changed hands, with gainers oputpacing losers, 112 to 77, while 40 issues were unchanged.

“Philippine shares started the month on profit taking with investors selling on news, with US Federal Reserve Chairman Jerome Powell’s statement, signaling slower rate hikes. Although, Powell cautioned the Fed may stay with restriction policy for a long time before it ends its inflation flight,” said Luis Limlingan of Regina Capital.

Meanwhile, shares advanced in Europe and Asia after a rally on Wall Street spurred by the Fed Chair’s comments on easing the pace of interest rate hikes to tame inflation.

Signs that China may be shifting its approach to containing COVID-19 outbreaks to focus more on vaccinations, while some cities have lifted pandemic lockdowns, also helped lift sentiment.

Stocks on Wall Street roared higher Wednesday after Powell said in comments at the Brookings Institution that the central bank could begin moderating its pace of rate hikes as soon as December, when its policymaking committee will hold its next meeting.

“We have a risk management balance to strike,” Powell said. “And we think that slowing down (on rate hikes) at this point is a good way to balance the risks.”

“The optimism in the market is that perhaps the worse is over for the U.S. in terms of inflation reading, and the Fed isn’t going to increase the interest aggressively,” Naeem Aslam of Avatrade said in a commentary.

Markets have wobbled all year as the Fed has fought high inflation with aggressive interest rate increases.

“While it could be argued that Jerome Powell’s comments on Wednesday were relatively balanced — slower tightening now but rates high for longer – the last year has proven that anticipating the path of inflation even a short period ahead is incredibly difficult,” Craig Erlam of Oanda said in a commentary.


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