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PH stocks rise on MSCI rebalancing, better-than-expected corporate profits

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Philippine stocks rose Thursday on window-dressing and MSCI rebalancing.

MSCI refers to the Morgan Stanley Capital International index, which is designed to measure the performance of the large and mid-cap segments of the market.

The Philippine Stock Exchange index surged 68.19 points, or 0.99 percent, to close a 6,944.71 while the broader all-shares index picked up 17.40 points, or 0.48 percent, to finish at 3,609.06.

“Philippine shares continued to outperform to close the month of February, buoyed by the latest MSCI rebalancing, while other investors weighed the latest earnings results and looked ahead to the Fed’s favored inflation gauge,” Regina Capital Development Corp. head of sales Luis Limlingan said.

Philstocks Financial Inc. research analyst Mikhail Plopenio said investors also welcomed the better-than-expected earnings of listed firms.

“Many funds also adjusted their portfolios ahead of the effectiveness of the MSCI rebalancing, boosting the market’s liquidity,” Plopenio said.

Value turnover reached P11.68 billion.

Other Asian markets also mostly rose on Thursday ahead of the release of crucial inflation data later in the day that will help chart the Fed’s rate cut timeline.

Investors are awaiting the release of the US Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s most-watched inflation indicator, which is expected to influence the central bank’s policy decisions.

Expectations for cuts to US interest rates have shifted to later this year because recent inflation data has come in hot and Fed policymakers have taken a wait-and-see attitude, calling for more time and data showing that inflation is moving towards their two percent goal.

Analysts say the PCE figures, and other US economic indicators coming Thursday, will likely influence market sentiment.

“The recent data is ‘noise’ and should be ignored outside of its impact for very short-term market movements,” Chris Zaccarelli, chief investment officer for Independent Advisor Alliance, told Bloomberg.

“We are more interested in the PCE data,” he said.

The world’s biggest economy will also report consumer and jobless figures.

“Given its status as a real-time gauge of the jobs market, the initial jobless claims release can sway investor perceptions and contribute to market volatility,” Stephen Innes, of SPI Asset Management, said in a note.

Wall Street’s main indices retreated on Wednesday, although losses on both the Dow and S&P 500 were modest.

“Stocks buoyed by A.I. euphoria encountered challenges in the final days of February as inflation concerns resurfaced, prompting investors to reckon with the prospect of higher interest rates likely to endure for an extended period,” Innes said.

“Indeed, investors have been in a state of cautious contemplation as they grapple with the shifting dynamics in interest rates, which have transformed from favorable trade winds to subtly challenging headwinds.”

New York Fed boss John Williams said Wednesday the central bank has “a ways to go” in its inflation fight, according to Bloomberg.

Eurozone inflation figures are due Friday.

Cryptocurrency bitcoin topped $63,000 on Thursday thanks to feverish demand, edging in on its November 2021 peak.

Bitcoin has been buoyed by US moves towards creating exchange-traded funds (ETFs) to track the price of the world’s most popular cryptocurrency, which would expand its potential investor pool by allowing the public to place bets without directly purchasing the digital unit.

Tokyo stocks closed lower, with the Japanese market lacking “clues for buying stocks after falls in US shares”, Matsui Securities said.

Hong Kong and Shanghai were trading higher, the latter up more than one percent.

Seoul, Wellington, Bangkok and Jakarta were lower, while Sydney, Taipei, Singapore, Manila and Kuala Lumpur were up. With AFP

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