Manila: The Philippine peso strengthened against the US dollar on Wednesday, but the Philippine Stock Exchange index (PSEi) experienced a decline due to selling pressure as investors reacted to the latest credit rating outlook on the domestic economy.

According to Philippines News Agency, the local currency gained traction against the greenback, closing the day at 61.65 compared to 61.73 on Tuesday. It opened stronger at 61.63, a notable improvement from the previous day's 61.77, and traded within a range of 61.67 to 61.52. The average exchange rate for the day was 61.58, with trading volume reaching USD1.90 billion, up from the previous day's USD1.57 billion.

Conversely, the local stock market's main index saw a decline for the second day in a row, dropping by 0.86 percent to 6,137.23 points. The broader All Shares index also fell by 0.52 percent to 3,394.57 points. The sectoral gauges showed mixed results, with the Services sector leading the decline at 2.47 percent, followed by Property at 0.45 percent, and Holding Firms at 0.21 percent. Meanwhile, Financials, Mining and Oil, and Industrial sectors posted gains of 0.30 percent, 0.14 percent, and 0.2 percent, respectively. The trading volume amounted to 862.4 million shares, valued at PHP5.35 billion.

Luis Limlingan, head of sales at Regina Capital Development Corporation, commented on the market dynamics, stating that selling pressure dominated the equities trading during the day. "Market sentiment turned cautious following Moody's forecast that Philippine GDP growth will remain below 6 percent over the medium term. Investors stayed on the sidelines as concerns over the country's growth outlook continued to weigh on risk appetite," he explained.