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PSEi, peso gain on upward revision of Q2 GDP

By Joann Villanueva

November 8, 2021, 8:00 pm

MANILA – The Philippine Stock Exchange index (PSEi) and the peso ended the week’s first trading day up due partly to the upward revision of the domestic economy’s second-quarter output to 12 percent from 11.8 percent.  

The main equities index rose by 0.76 percent, or 55.45 points, to 7,396.22 points. 
 
All Shares followed with a jump of 0.44 percent, or 19.88 points, to 4,510.89 points. 
 
Most of the sectoral indexes also increased during the day with the Financials rising by 2.23 percent; Services, 1.41 percent; Property, 1.03 percent; and Industrial, 0.17 percent. 
 
On the other hand, Mining and Oil slipped by 0.76 percent and Holding Firms by 0.34 percent. 
 
Volume reached 1.34 billion shares amounting to PHP8.3 billion. 
 
Gainers led decliners as 107 to 101, while 44 shares were unchanged. 
 
Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort partly attributed the positive turnouts of both the PSEi and the peso to the Philippine Statistics Authority’s (PSA) report about the adjustment of the 2021 second-quarter growth, as measured by gross domestic product (GDP). 
 
In a statement on Monday, the PSA attributed change in the GDP figure for the second quarter to higher contributions of the education sector, from 10 percent to 12.6 percent; along with the financial and insurance activities, from 4.2 percent to 5.2 percent; and the construction, from 25.7 percent to 27.1 percent. 
 
For the peso, Ricafort said seasonal increase in remittance inflows from overseas Filipino workers (OFWs) ahead of the Christmas holidays continue to boost the local currency.
 
“The PSEi and peso continued to gain amid market optimism to further reopen the economy on possible adoption of the Alert Level System or smaller/scale lockdowns nationwide by December 2021, thereby further boosting economic activities/growth,” he said.
 
He added further decline of daily coronavirus disease 2019 (Covid-19) infections also supported both the equities index and the local currency as this supports bids to further reopen the economy.
 
Ricafort also cited the improvement in US’ jobs data as well as the news about the Federal Reserve’s decision to ease its monthly bond-buying program as positive factors for the equities and currency trading during the day. 
 
He forecasts the PSEi’s next important resistance level at 7,500 “as the next gateway prior to further upside potential towards new pre-pandemic highs, going forward.” 
 
Meanwhile, the peso closed the day’s trade at 50.16 to a US dollar from 50.33 last Friday. 
 
It opened the day at 50.3, better than its 50.62 start in the previous session.
 
It traded between 50.13 and 50.34, resulting in an average of 50.241.
 
Volume totaled to USD933.2 million, lower than the USD1.2 billion at the end of last week.
 
Ricafort also projects the peso to trade between 49.70 to 50 on Tuesday. (PNA)
 

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