By Ed Paolo Salting, Manila Times
THE Philippine Stock Exchange (PSE) plummeted on Wednesday by 155.11 points, or by 2.40 percent, to 6,319.42 as the local market was affected by the negative sentiment from last night's performance of the US bourses.
Regina Capital Development Corp. Managing Director Luis Limlingan, Rizal Commercial Banking Corp. chief economist Michael Ricafort and Philstocks Financial Inc. senior research analyst Japhet Tantiangco all agreed that investors are worried over an aggressive rate hike by the US Federal Reserve Bank.
The further depreciation of the Philippine peso against the United States dollar and higher US Treasury yields added to the market's bearish sentiment.
"The rate-setting Federal Open Market Committee will conclude its two-day meeting on Wednesday. The market is betting on a 75-basis-point rate hike, according to the CME Group Inc.'s FedWatch tool. Today's moves also came as investors digested another important inflation reading of May's producer performance index, which showed that wholesale prices rose 10.8 percent, and hovered near a record pace," Limlingan explained in his analysis.
Meanwhile, Vista Land's real estate investment trust (VREIT) debuted on the PSE and Limlingan and Ricafort noted that it would have finished much higher if it were not for the current market sentiment.
They said that the company aims to maintain high occupancy rates and quality tenants with particular focus on those offering essential goods and/or services. Also, its weighted average lease expiry of 5.09 years is quite impressive while the relatively high occupancy rate for malls was at 90 percent as of end-2021 despite the pandemic.
VREIT closed unchanged at its initial public offering price of P1.75 per share, and saw an intraday low of P1.59.
Other Asian bourses ended up mixed as Japan descended again by 1.14 percent, China climbed 0.50 percent, Hong Kong up 1.14 percent, Korea down by 1.83 percent, Vietnam dipped at 1.33 percent, Indonesia inched downwards by 0.61 percent, Thailand slid by 0.59 percent and Singapore slipped by -0.10 percent.
Trading remained anemic with net value turnover posting P5.84 billion, below the year-to-date average of P6.80 billion.
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