Stocks up on slight deceleration of inflation; peso weakens

Stocks up on slight deceleration of inflation; peso weakens

MANILA – The local stock barometer gained anew on Tuesday partly on the better-than-expected inflation rate for February 2023 but the peso weakened against the United States dollar.

The Philippine Stock Exchange index (PSEi) rose by 0.51 percent, or 34 points, to 6,705.12 points.

All Shares followed with a jump of 0.48 percent, or 17.15 points, to 3,590.21 points.

Most of the sectoral gauges also ended with gains, led by Industrial after it increased by 1.57 percent.

It was trailed by Property, 1.06 percent; Financials, 0.68 percent; Mining and Oil, 0.34 percent; and Services, 0.04 percent.

Only Holding Firms ended the day down after losing by 0.32 percent.

Volume reached 1.82 billion shares amounting to PHP5.5 billion.

Advancers led decliners at 102 to 84 while 48 shares were unchanged.

“Philippine shares traded in the green as the markets welcome the better-than-expected February CPI (consumer price index) print, which may give hints that prices in general are peaking,” said Luis Limlingan, Regina Capital Development Corporation head of sales.

The Philippine Statistics Authority (PSA) reported during the day the slight easing of rate of price increases to 8.6 percent in February from the previous months’ 14-year high 8.7 percent.

Limlingan said the latest inflation print is below the 8.9 percent consensus forecast.

“In addition, momentum was carried over as investors await Fed (Federal Reserve) Chair Jerome Powell’s latest comments on the state of the economy,” he said.

Oil prices also climbed “as top oil executives at an energy conference in Houston discussed supply tightness and hopes for rising Chinese demand.”

Brent crude oil futures inched up by 0.4 percent to USD86.18 per barrel and the West Texas Intermediate (WTI) by 1 percent to USD80.46 per barrel.

Meanwhile, the local currency depreciated against the US dollar to 55.00 from the previous day’s 54.88 finish.

It opened the day at 55.03 and traded between 55.15 and 54.99. The average for the day stood at 55.081.

Volume rose to USD896.8 million against Monday’s USD810.1 million.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort attributed the peso’s performance to the improvement of the 10-year US Treasury rates given the hikes in US’ interest rates.

Ricafort also cited the rise of the national government’s outstanding debt as of January 2023 and the better-than-expected inflation rate which could likely result to 25 basis points increase in the Bangko Sentral ng Pilipinas’ (BSP) key rates later this month.

Amidst its depreciation during the day, he said the local unit remains “relatively stable lately after the local stock market gauge, the PSEi, again gained for the fifth consecutive day.”

For Wednesday, the local unit is expected to trade between 54.90-55.10 against the greenback. (PNA)

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