The local stock market closed the week in the red as investors went on a selling spree in response to news that interest rates may be brought down soon.
The Philippine Stock Exchange index (PSEi) slipped by 9.51 points, or 0.14 percent, to close at 6,618.69, while the broader All Shares index dipped by 0.37 point, or 0.01 percent, to settle at 3,524.15.
According to industry experts, investors sold their shares at the last minute following the announcement from the Bangko Sentral ng Pilipinas (BSP) that it may slash policy rates in August. BSP Governor Eli Remolona Jr. mentioned that the Monetary Board could potentially cut rates twice this year, by 25 basis points each.
The central bank is currently maintaining the benchmark rate at 6.50 percent, committing to make changes only once inflation falls within the target range. As of January to April, inflation has averaged 3.4 percent, landing on the higher end of the target band of two percent to four percent for 2024.
Negative sentiments from foreign markets, including in the US, also contributed to the negative performance of the PSEi, as mentioned by industry experts. Despite winners outpacing losers, with 93 to 91, and 67 issues remaining unchanged, a total of P19.43 billion in shares changed hands throughout the day.
