The Federal reserve delivered the widely anticipated 75 bps hike and warned that there will be more increases to come. In its goal to bring down inflation running near its highest levels since the 1980\u2019s, the central bank took its federal funds rate up to a range of 3.00 \u2013 3.25%, the highest it\u2019s been since early 2008. The Fed has now raised its policy rate by 75 bps in each of their last three meetings. U.S markets were down, with the Dow Jones Industrial Average sliding 522.45 points, or 1.7% to close at 30,183.78. The S&P 500 dropped 1.71% to 3,789.93 and the Nasdaq dipped 1.79% to close at 11,220.19.<\/p>\n\n\n\n
Our View:<\/strong> After August\u2019s gloomy inflation report, there was never any doubt that the Fed would hike up rates. BSP Governor Medalla previously mentioned that what the Fed is doing will be highly considered by the BSP.<\/p>\n\n\n\n Yesterday, the PH Peso lost more ground vs the US Dollar, closing at PHP 58.00 to USD 1.00. The Philippines CPI report for August also showed that core inflation was at 4.6% compared to 3.9% last month and that average inflation stood at 4.9%, still above the government\u2019s 2-4% target band. We thus expect the BSP to react to the Fed\u2019s move in their Monetary Board meeting later today.<\/p>\n\n\n\n Opportunistic buying window at 6,200 levels. We will likely see a knee-jerk reaction in the PSEi today and we will be opportunistic at the 6,200 level. The PSEi will be trading at a forward 2023 P\/E ratio of 13x at 6,200 level which would yield to 7.7% for a decent premium over Philippine 10-year bonds.<\/p>\n\n\n\n Our strategic position remains the same given the bleak near term outlook of the market. We prefer selective exposure in the top 3 banking stocks, specifically MBT. We also like the retailers (RRHI, WLCON) and consumer manufacturers (PIZZA, CNPF) and some high-dividend paying stocks (TEL, SCC and DMC).<\/p>\n","protected":false},"excerpt":{"rendered":" Here’s a commentary on an important issue or event affecting the stock market <\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-317502","post","type-post","status-publish","format-standard","hentry","category-special-reports","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317502","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=317502"}],"version-history":[{"count":2,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317502\/revisions"}],"predecessor-version":[{"id":320498,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317502\/revisions\/320498"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=317502"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=317502"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=317502"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}