PH stocks tumble over Fed signal

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Philippine stocks fell Thursday, closing below the 6,400 level, as investors digested the latest US inflation data and policy signal from the US Federal Reserve.

“Philippine shares continued to tumble as investors digested the latest policy announcement from the Fed and May inflation data, which pointed to easing pressures,” Regina Capital Development Corp. head of sales Luis Limlingan said. The weaker-than-expected May consumer price index marked a second successive month of slowing — to a more than three-year low — and boosted optimism that the central bank would be able to soften monetary policy after a long-running campaign of tightening.

The “dot plot” saw the S&P 500 and Nasdaq come off their intra-day highs, although they still managed to chalk up a third successive record close, with analysts saying the positive run of inflation data could allow the bank to cut more. And Lon Erickson, at Thornburg Investment Management, added: “Powell specifically commented that the labor market can weaken very quickly and the Fed is not waiting for that.

 

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