Peso closes at over 4-year high vs. USD; stocks flat

Peso closes at over 4-year high vs. USD; stocks flat

MANILA – The peso closed almost unchanged Monday but was still over four-year high against the greenback amid US election results, while the local bourse’s main index also barely moved ahead of the third-quarter domestic output report.

The local currency ended the week’s first trading day at 48.145 from its 48.22 close last Friday.

It opened the day at 48.15, an improvement from the previous session’s 48.27.

It traded between 48.18 and 48.11, resulting in an average of 48.134.

Volume totaled to USD679.3 million, lower than the USD779 million in the previous session.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said reports that Joe Biden won the US presidential race resulted in “hefty gains in the local and US/global stocks market recently”, which in turn, weakened the US dollar.

“Biden victory as (the) next US President (is) seen as generally favorable to Asia such as the Philippines, with the expected easing of the US-China trade war,” he said.

Ricafort said expected improvement in the third quarter output, as measured by gross domestic product (GDP), also buoyed investors’ sentiment.

This, even after the second-quarter 2020 GDP was revised down from -16.5 percent to -16.9 percent.

“US/Global market risk appetite improved amid continued improvement of the latest US jobs/labor data, partly supporting the latest gains in the peso. Faster growth in the latest agricultural data in 3Q (third quarter) 2020 also supported the peso,” he added.

Meanwhile, the Philippines Stock Exchange index (PSEi) gained 0.002 percent, or 0.16 points, to 6,685.85 points.

All Shares improved by 0.42 percent, or 16.40 points, to 3,961.12 points.

Most of the sectoral indexes also rose during the day, led by the Mining and Oil, which inched up by 3.16 percent.

Industrial posted an uptick of 1.90 percent; Property, 1.16 percent; Services, 0.38 percent, and Financials, 0.23 percent.

Only the Holding Firms ended the day on the red after it lost 1.27 percent.

Volume totaled 1.71 billion shares amounting to PHP8.02 billion.

Gainers led losers at 131 to 83, while 43 shares were unchanged.

Luis Limlingan, Regina Capital Development Corporation head of sales, attributed the slight movement in the main stocks index to investors’ wait-and-see stance on the third-quarter GDP report, which the government is scheduled to announce on Tuesday.

“It is expected that 3Q GDP will still contract y/y (year-on-year) but improved after a historical 16.9 percent y/y contraction in the previous quarter,” he said.

The outcome of the US elections, wherein Joe Biden was announced as the winner for the presidential post, as well as updates on the coronavirus disease 2019 (Covid-19) infections worldwide were also among the factors on Monday’s trading, he added. (PNA)

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