BSP action boosts PHL shares at early trades

Philippine share prices rose sharply at early trades Monday as the decision of Bangko Sentral ng Pilipinas to keep policy rates unchanged at record lows continued to feed on investors' optimism toward the market.

 

The main PSEi was up 47.32 points or 0.70 percent to 6,778.28 as of 10:20 a.m. The All Shares index increased by 20.31 points or 0.50 percent to 4,062.32.

 

The market started strong as investors continued to cheer the Bangko Sentral decision last week, Joyce Ramos, analyst at AB Capital Securities Inc., told GMA News Online.

 

"It is possible for the market to test the 6,800 level today due to the extended reaction from the BSP meeting last Thursday," she said.

 

In the policy meeting on Thursday, the Monetary Board kept the overnight lending unchanged at 3.5 percent and the overnight borrowing at 5.5 percent while maintaining the reserve requirement for banks at 8 percent for thrift banks and at 20 percent for commercial and universal banks, but raised the yield on special deposit accounts (SDAs) by 25 basis points to 2.25 percent.

 

However, Ramos said the optimism from the latest Bangko Sentral action may be tempered by developments overseas.

 

"Since there are no fresh leads, foreign updates, like significant data from the US or the situation in Iraq, may act as catalyst for the market," she added. – VS, GMA News