Stocks drop on Fed signals, junk food tax

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The local stock market continued to weaken as US bourses dropped in reaction to recent comments by Fed Chairman Jerome Powell. | ManilaBulletin

The main index declined by 19.30 points or 0.30 percent to close at 6,404.91 as the Industrial sector led the retreat with only the Services counter rising. Volume was relatively steady at 926 million shares worth P5.45 billion as losers beat gainers 106 to 73 with 47 unchanged.

“Philippine shares logged another day of declines as the US tech-powered rally faded, while others waited for the BSP meeting to conclude,” said Regina Capital Development Corporation Managing Director Luis Limlingan. He added that, “Today's moves also came in on the back of the comments from Fed Chair Powell saying more rate hikes are likely ahead to combat inflation. The Fed kept rates steady at last week’s policy meeting after 10 consecutive hikes.”

Philstocks Financial Research and Engagement Officer Mikhail Plopenio said “This Thursday, the local market dropped due to negative spillovers from Wall Street overnight. This came following Federal Reserve Chair Jerome Powell’s remarks in his testimony to the US Congress where he signaled more possible rate hikes.”

“Moreover, the decline in URC and MONDE amid the reported proposed excise taxes on junk foods and sweetened beverages dragged the index down,” he added.

 

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