MANILA – Volatility during the first quarter of the year summarized the main equities index’s negative close on Friday but the peso finished the day sideways against the greenback after a strong close on Thursday.
The Philippine Stock Exchange index (PSEi) shed 0.70 percent, or 50.59 points, to 7,152.88 points.
Its negative close was followed by all other counters, with the All Shares down by 0.61 percent, or 23.24 points, to 3,788.59 points.
Holding Firms registered the highest decline among the sectoral indices and was trailed by Services, 0.73 percent; Financials, 0.66 percent; Industrial, 0.58 percent; Mining and Oil, 0.49 percent; and Property, 0.17 percent.
Volume reached 15.20 billion shares amounting to PHP5.4 billion.
Decliners outpaced advancers at 106 to 65, while 46 shares were unchanged.
“Philippine shares were sold ahead of the weekend as traders wrapped up a rocky first quarter,” said Luis Limlingan, Regina Capital Development Corporation (RCDC) head of sales.
Limlingan also cited reports that doused hopes for a possible peace deal between Ukraine and Russia.
This, after Russian President Vladimir Putin warned to stop oil supply contracts to Europe unless the latter pay in rubles.
Other factors for the day’s equities trading include US February 2022 core personal consumption expenditure (PCE), which posted a 5.4-percent growth, slower than the Federal Reserve’s expectations of 5.5 percent; and the report on domestic bank lending, which grew for the seventh consecutive month last February after a jump of 8 percent.
Despite the negative close of the main equities index, the peso finished the day’s trade still on a positive note at 51.67, sideways from its 51.74 close a day ago. It was still the strongest since March 3, 2022 when it closed at 51.50.
It opened the day at 51.79, better than its 51.98 start in the previous session.
It traded between 51.81 and 51.55, resulting in an average of 51.664.
Volume reached USD1.33 billion, higher than the previous day’s USD1.05 billion.
In a report, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort attributed the peso’s strength to the decline of oil prices in the international market.
He said crude oil prices fell to its two-week lows at around USD100 per barrel for the Nymex crude on news that the US is set “to release oil to the market from its strategic petroleum reserves about one million barrels per day for six months (or a total of 180 million barrels or equivalent to about two days of global oil demand) and still some lockdowns that could reduce oil demand in China, which is the world’s biggest oil importing country.”
Ricafort said other factors that backed the local currency during the day include the retention of the Alert Level 1 status for the National Capital Region (NCR) and 48 other areas in the country until April 15, 2022, and the resumption of the direct Russia-Ukraine talks.
He said the final month of the national and local campaign period “could also lead to some inflows of US dollars/remittances into the country to partly fund the said election-related spending/campaign.”
Ricafort said the US dollar/peso exchange rate further declined from the immediate high of 52.495 posted on March 15, 2022.
“For the first week of April 2022, the US dollar/peso exchange rate corrected lower for the second straight week, by -0.48 or -0.9 percent (vs. the previous week's -0.185 or -0.3 percent),” he added. (PNA)
