MIXED RESULTS. Investors stood at the sidelines vis-a-vis the results of the ongoing midterm elections in the US, resulting in another negative close of the local bourse's main index. However, the peso gained against the US dollar, partly due to the upward revision of the domestic economy's 2022 second quarter output to 7.5 percent. (PNA graphics)
MANILA – The local bourse’s main index shed anew on Wednesday as investors awaited the results of the ongoing midterm elections in the United States but the peso gained against the dollar and even rose to 57-level.
The Philippine Stock Exchange index (PSEi) declined by 0.75 percent, or 47.42 points, to 6,241.68 points.
All Shares followed with a drop of 0.45 percent, or 15.01 points, to 3,292.74 points.
Majority of the sectoral indices also finished the day in the negative territory, namely Mining and Oil, 2.72 percent; Property, 2.07 percent; Services, 2 percent; and Financials, 0.38 percent.
On the other hand, Industrial rose by 0.39 percent and Holding Firms by 0.11 percent.
Volume reached 427.71 million shares amounting to PHP5.57 billion.
Decliners led advancers at 95 to 84 while 39 shares were unchanged.
“Investors remained on the sidelines, as many are watching the outcome of the midterm election (in the US), which could heavily influence government spending and regulation,” said Luis Limlingan, Regina Capital Development Corporation (RCDC) head of sales.
He said “historically, equities tend to rise after midterm elections and the policy clarity it brings.”
He added the last two months of the year “are considered a bullish period for investors.”
On the local front, Limlingan said investors took note of the upward revision on the domestic economy’s output in the second quarter of 2022.
The Philippine Statistics Authority (PSA) revised the second quarter gross domestic product (GDP) to 7.5 percent from the preliminary figure of 7.4 percent.
This was due to the higher output of construction, from 19 percent rise to 19.5 percent; real estate and ownership of dwellings, from 3.9 percent to 4.4 percent; and manufacturing, from 2.1 percent to 2.2 percent.
The PSA reported on Wednesday the 1.8-percent growth in the value of products in agriculture and fisheries in the third quarter of 2022, a turn-around from the -2.6 percent print in the same period in 2021.
The upward revision of the domestic economy’s output from April to June this year also contributed to the improvement of the local currency, an economist said.
The peso appreciated to 57.99 against the greenback, its highest after closing at 57.48 last Sept. 20, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said. It closed at 58.275 on Tuesday.
It opened on a better level for the day at 58.17 from 58.38 a day ago.
It traded between 58.22 and 57.9, resulting in an average of 58.077.
Volume rose to nearly USD1.11 billion from the previous session’s USD954.9 million.
Aside from the upward adjustment of the GDP figure, Ricafort also traced the peso’s performance to the weakening of the US dollar against major currencies “amid improved global market risk appetite.”
He also cited anticipations for a deceleration of US’ inflation rate last October, which is projected to be at around 7.9 percent from 8.2 percent last September, also lifted sentiments.
He forecasts the peso to trade between 57.90-58.10 to a US dollar on Thursday. (PNA)
