PSEi rebounds as US-Iran accord lifts sentiment

MANILA, Philippines – Local stocks bounced back on Thursday as investors welcomed signs of easing conflict in the Middle East, raising hopes of more stable oil supplies and a softer inflation outlook.

The benchmark Philippine Stock Exchange Index (PSEi) climbed 0.64 percent, or 38.85 points, to close at 6,153.66, recovering part of the previous session’s losses.

READ: Trump, Iran’s president sign deal to end Middle East war

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Luis Limlingan, head of sales at Regina Capital Development Corp., said the Philippine market ended in positive territory, recovering from yesterday’s broad-based sell-off, supported by improved investor sentiment following reports of a peace deal between the United States and Iran.

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“Gains were sustained for most of the session, although selective profit-taking emerged in the afternoon, particularly among interest rate-sensitive stocks. This came after the Bangko Sentral ng Pilipinas maintained its tightening stance and continued its rate hikes, prompting investors to reassess sectors exposed to higher borrowing costs,” Limlingan said.

According to brokerage Philstocks Financial Inc., the deal includes the reopening of the Strait of Hormuz for at least 60 days, a move expected to ease concerns over disruptions in global oil supply.

Lower oil price risks could help temper inflationary pressures, providing support to financial markets.

Modest trading activity

Despite the advance, trading activity remained subdued. Net value turnover stood at P6.03 billion, reflecting cautious participation from investors as they continued to assess geopolitical developments and their impact on the economy.

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Foreign investors provided support to the market, ending the session as net buyers with inflows amounting to P167.55 million.

Sectoral performance was mixed. The services index posted the strongest gain, rising 2 percent, while the mining and oil sector suffered the biggest decline, falling 2.87 percent.

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Among index members, DigiPlus Interactive Corp. emerged as the session’s top performer after surging 9.11 percent to P12.22.

Meanwhile, Puregold Price Club Inc. was the day’s biggest loser, dropping 6.61 percent to P41 per share.

The market’s recovery came after investors reacted positively to developments that could reduce risks to global energy supplies.

Analysts said any sustained easing in geopolitical tensions may further improve sentiment, particularly if it leads to lower oil prices and a more favorable inflation environment.

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Still, the relatively modest turnover suggests many investors remain on the sidelines while awaiting clearer signals on global economic conditions and the durability of the recent market rebound. /pai INQ