MANILA – The Philippine Stock Exchange index (PSEi) slipped anew on Thursday but the peso managed to end the day sideways against the US dollar amid the hawkish signal from the Federal Reserve.
The main equities index shed by 0.26 percent, or 18.01 points, to 6,924.99 points.
All Shares moved sideways after gaining 0.06 percent, or 2.50 points, to 4,274.66 points.
Most of the sectoral gauges tracked the main index namely the Industrial, which fell by 0.51 percent; Property, 0.50 percent; Financials, 0.49 percent; and Holding Firms, 0.13 percent.
On the other hand, Mining and Oil rose by 0.67 percent and Services by 0.53 percent.
Volume totaled 1.36 billion shares amounting to PHP5.04 billion.
Losers led gainers at 119 to 82, while 50 shares were unchanged.
“Philippine shares continued to weaken as the market perceived the just-released US Federal Reserve minutes as dovish,” said Luis Limlingan, Regina Capital Development Corporation head of sales.
Earlier, Fed officials said rate tightening might happen earlier than expected, with some noting this possibility around the latter part of 2022.
Despite the concerns on this issue, the peso managed to end the day sideways against the US dollar at 49.875 from the previous day’s 49.79 finish.
It opened the trade at 49.85 and traded between 49.97 and 49.79.
Average level for the day stood at 49.87.
Volume totaled USD1.13 billion, higher than the previous session’s USD937.9 million.
Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort partly attributed the peso’s recent performance to the strengthening of the US dollar against most currencies in the region.
“But the peso fared worse than most of them since last month, as may have been triggered by the Fed’s more hawkish signals since last month,” he said.
He also considered pent-up demand or importation as other factors for the peso’s volatility since last month “as the economy further reopens from lockdowns since NCR (National Capital Region) Plus eased to GCQ (general community quarantine) since May 15, 2021, leading to some pick up in economic activities as well as in importation especially on view the seasonal increase in importation in 3Q (third quarter).”
“However, after the seasonal rise in importation in 3Q, exports are expected to seasonally rise in the latter part of 3Q up to 4Q (fourth quarter), as well as the widely expected seasonal increase in OFW (overseas Filipino workers’) remittances and conversion to pesos in 4Q in time for the Christmas season, thereby could help support the peso by then,” he added. (PNA)