Stocks fell slightly Wednesday as some investors opted to cash in on recent gains while others adopted a consolidation mode in the absence of a catalyst that could push the market higher.
The Philippine Stock Exchange Index slipped 34.6 points, or 0.5 percent, to 7,253.61 on a value turnover of P6.4 billion. Losers beat gainers, 102 to 78, with 60 issues unchanged.
PLDT Inc., the biggest telecommunications firm, declined 2.4 percent to P1,840, while Security Bank Corp., the eight-largest lender in terms of assets, dropped 2.4 percent to P105.
Retail coffee chain Figaro Coffee Group Inc. jumped 18 percent to P0.92, while Solar Philippines Nueva Ecija Corp., which is building what is being touted as the biggest solar farm in Southeast Asia, rose 2.5 percent to P2.07 to extend a rally.
Most Asian markets, meanwhile, rose Wednesday to provide some respite from the hefty selling at the start of the week, with focus on the end of the Federal Reserve’s policy meeting later in the day, when traders hope it will provide much-needed guidance on its plans for hiking interest rates.
After a second day of high volatility in New York, Asia enjoyed a little more stability.
Hong Kong, Shanghai, Singapore, Wellington, Jakarta and Bangkok rose, though Tokyo, Seoul and Taipei edged down. Sydney and Mumbai were closed for holidays.
After weeks of uncertainty, the US central bank will finally deliver its views on the state of the world’s top economy and how officials plan to tackle inflation that is now at a four-decade high without knocking its recovery off course.
Minutes from its December gathering pointed to a more hawkish tilt, with plans to speed up the taper of its vast bond-buying program, the selling of the assets it already has and three or four rate increases before the end of the year.
While boss Jerome Powell pledged any tightening would be carefully calibrated, the prospect of higher borrowing costs has rattled markets across the world with most key indexes deep in the red from the start of the year, with Wall Street particularly hard hit.
His comments after the meeting will be pored over for signs of the Fed’s plans, which most commentators believe include a first hike in March.
Analysts were leaning positive ahead of the meeting.
Frances Stacy, at Optimal Capital, told Bloomberg Television that Powell would try to take a less hawkish tone, saying policy would be guided by data while supply chains were improving and inflation showed signs of peaking.
“I think what that’s going to do is potentially reassure markets that the Fed ‘put’ is ready, willing and able,” she said, referring to the bank’s past in backstopping markets. “That could cause some serious enthusiasm and a short squeeze.”
Michael Hewson at CMC Markets added: “While no changes to policy are expected… markets will be looking for clues as to how concerned Fed officials are about headline (consumer inflation) and whether they might be leaning towards a potential 50 basis point hike in March, rather than the 25 that is currently priced. With AFP
