Market ends slightly higher after late selling

Share prices closed little changed yesterday, after last-minute selling by investors ahead of a key interest rate decision by the local central bank, dealers said.

Strength in select blue chips led by Philippine Long Distance Telephone Co. (PLDT) kept the index in positive territory for most of the session, they said.

The composite index was up 5.64 points at 3,775.46, after moving between 3,732.89 and 3,801.30. A total of 7.8 billion shares valued at P8.03 billion changed hands.

Decliners narrowly outnumbered gainers 63 to 61, and 43 stocks were flat.

Dealers said most investors have priced in a 25-basis-point cut in key interest rates as shown by the strong advance of interest rate-sensitive stocks like property developers and banks in recent sessions.

“We may see a pullback tomorrow if the central bank decides not cut interest rates,” said Lawrence de Leon of Accord Capital Equities.

He said any correction is unlikely to be deep because the central bank may still see the need to cut interest rates before the year ends, especially if the Federal Reserve further trims its benchmark rate later this month.

The Fed is to hold a two-day meeting beginning Oct. 30, when it will decide whether to follow its larger-than-expected half-point rate cut on Sept. 18 with a further reduction.

PLDT closed unchanged at P3,040. But rival Globe Telecom Inc. closed P60 higher at P1,600, off its new record high of P1,610. Globe was largely ignored in recent market rallies that were led by PLDT.

Metrobank, the country’s largest bank by assets, advanced P1.50 to P59.50.

San Miguel Corp.’s class A shares retreated P1 to P61.50. The food and beverage group’s B shares slipped P1 to P64.

“An unchanged stance by the central bank will prompt investors to lock in gains from the market’s rally. A rate cut, meanwhile, may inspire some more buying even if the market is already at an overbought level,” said Ron Rodrigo, head of research at Unicapital Securities.

The benign inflation outlook and the US Federal Reserve’s hefty rate cut Sept.18 provided room for the central bank to cut rates in a meeting later Thursday, he said.

Conglomerate SM Investments Corp. rose 4.5 percent to P407.50. Globe Telecom Inc. jumped 3.9 percent to a new record finish of P1,600  ahead of its third-quarter earnings results. — AFP, AP