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PH stocks index slips as peso keeps footing vs. US dollar

By Joann Villanueva

December 23, 2022, 6:43 pm

<p><strong>MIXED</strong>. Recession concerns affected the local bourse on Friday (Dec. 23, 2022) resulting to its slide after days of rally. On the other hand, the peso ended the day sideways against the US dollar, bolstered by the higher remittance inflows from overseas Filipino workers for the Christmas holiday. <em>(PNA file photo) </em></p>

MIXED. Recession concerns affected the local bourse on Friday (Dec. 23, 2022) resulting to its slide after days of rally. On the other hand, the peso ended the day sideways against the US dollar, bolstered by the higher remittance inflows from overseas Filipino workers for the Christmas holiday. (PNA file photo) 

MANILA – Fears for global slowdown given the tightening moves of central banks resulted to the decline of the Philippines’ main equities index on Friday but the peso ended sideways against the US dollar.

The Philippine Stock Exchange index (PSEi) shed 0.55 percent, or 35.91 points, to 6,541.03 points.

All Shares followed with a drop of 0.28 percent, or 9.79 points, to 3,432.47 points.

Most of the sectoral indices tracked the main index, namely Holding Firms, 0.95 percent; Financials, 0.85 percent; Property, 0.78 percent; and Mining and Oil, 0.38 percent.

On the other hand, industrial gained by 0.42 percent and Services by 0.36 percent.

Volume reached 1.91 billion shares amounting to PHP3.14 billion.

Decliners led advancers at 94 to 72 while 46 shares were unchanged.

“Philippine shares were sold off ahead of the long weekend as investors worried that over tightening from central banks worldwide could force the economy into a downturn,” Luis Limlingan, Regina Capital Development Corporation (RCDC) head of sales, said.

For one, US Federal Reserve’s key rates have been hiked by a total of 425 basis points to between 4.25-4.5 percent since last March as monetary authorities hasten to address the four-decade high inflation rate in the world’s largest economy.

Relatively, the Bangko Sentral ng Pilipinas’ (BSP) key rates have been increased by a total of 350 basis points to 5.5 percent for the overnight reverse repurchase (RRP) facility.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort, on the other hand, said the main index registered a healthy correction due to profit-taking in line with its US counterparts.

“Market sentiment, especially on tech shares, was weighed by a bleak outlook from chipmaker Micron Technology Inc. (the largest US maker of memory chips), which will reduce its workforce by about 10 percent over the next year, thereby indicated the slump in demand for computer components will drag on,” he said.

Meanwhile, the decline of the PSEi was countered by the sideways close of the local currency, which finished the week at 55.15 from its 55.09 close on Thursday.

It opened the day at 55.25, weaker than its 55.045 start in the previous session.

It traded between 55.35 and 55.15, resulting to an average of 55.271.

Volume rose to USD1.02 billion from the previous day’s USD774.2 million.

Ricafort said the peso continues to get a boost from higher inflows of remittances in line with the Christmas spending and the year-end holiday expenditures.

“The peso exchange rate has been relatively insulated by the recent volatility in the local stock market, largely due to the seasonal surge in OFW (Overseas Filipino Workers) remittances and conversion to peso less than a week before Christmas,” he added. (PNA) 

 

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