Lima Stock Exchange closed in red after Fed rate hike

The Lima Stock Exchange (BVL) ended the day on Wednesday in negative territory due to the drag of the financial and mining sectors, after the record increase of half a percentage point in the reference interest rate of the Federal Reserve (Fed) of the United Statesto try to control inflation.

At the close of trading, the S&P/BVL Peru General, the most representative of the Lima stock market, fell by 0.55% to 22,469.02 points.

Similarly, the S&P Index/BVL Peru Selective, which is made up of the most traded shares in the local market, fell by 0.14% and was placed at 589.27 units.

During the session, a traded amount of S/35.6 million was reported in 459 operations. In addition, shares of 75 companies were listed, of which 28 rose, 27 fell and 20 did not show any variation.

By sectors, those that had losses were financial (-3.01%) and mining (-2.79%). While those of construction (0.93%), industrial (0.52%) and consumption (0.02%) closed in green. Meanwhile, services, electricity did not register changes.

Among the local stocks that fell the most: Compañía Minera Santa Luisa (-5%), Sociedad Minera Cerro Verde (-3.74%), PPX Mining (-3.33%), Minera IRL Limited (-2.70%) , and Minsur (-1.82%).

In contrast, the ones that rose the most were Quimpac (72.41%), Citigroup (4.42%), Cartavio (4.17%), Volcan Compañía Minera (3.66%) and Banco Pichincha (3.24%). .

“At the local level, the Peruvian Index did not respond in the same way as the American, recovered somewhat near the close, but still closed lower”, said César Romero, head of research at Renta4 SAB.

Globally, US stocks rose on Wednesday afternoon, with investors considering the latest monetary policy decision from the Federal Reserve in the context of high inflation and a still tight US labor market.

The S&P 500, the Dow Jones and the Nasdaq extended their gains, after the president of the fedJerome Powell, suggested that central bank officials were not discussing future interest rate increases of 75 basis points at the time.

The benchmark 10-year Treasury yield rose to just under 3%, or close to its highest level since late 2018. Investors pondered the monetary policy statement from the Federal Reservein which the central bank announced its decision to raise interest rates by 50 basis points for the first time since 2000, the expert noted.

The latest hike brought the target range for the fed funds rate between 0.75% and 1%.