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PSEi snaps rally ahead of key data releases; peso ends sideways

The main stock index closed lower on Monday ahead of the shortened week for Wall Street but the peso managed to end the day sideways against the United States dollar.


The Philippine Stock Exchange index (PSEi) shed 0.53 percent, or 34.14 points, to 6,403.24 points.


All Shares followed with a drop of 0.31 percent, or 10.67 points, to 3,385.96 points.


Despite the slip in the main index, most of the sectoral indices gained during the day, namely Industrial, 0.62 percent; Services, 0.56 percent; Financials, 0.17 percent; and Mining and Oil, 0.11 percent.


However, Property and Holding Firms declined by 2.14 percent and 0.89 percent, respectively.


Volume reached 776.16 million shares amounting to PHP6.24 billion.


Decliners led advancers at 97 to 87 while 40 shares were unchanged.


“Philippine shares took a breather after successive sessions of trading in the green last week, with a shortened trading week ahead for Wall Street,” said Luis Limlingan, Regina Capital Development Corporation (RCDC) head of sales.


US will be celebrating Thanksgiving Day on Nov. 24.


There will be a lot of economic data releases for this week in the US, which markets are all eyes on, and these include the durable goods report, new home sales, unemployment claims, consumer sentiments and minutes of the Federal Reserve meeting earlier this month.


On the local front, investors are gearing up for the release of the national government’s October 2022 fiscal report.


Oil prices slipped for the second consecutive week “due to concerns about weakened demand in China and further increases of US interest rates,” Limlingan said.


Brent crude futures declined by 3.1 percent to USD86.96 per barrel and US West Texas Intermediate (WTI) by 3.2 percent to USD79.01 per barrel.


Similarly, risk-off sentiments affected the local currency but the peso managed to end the day sideways against the US dollar at 57.36 from 57.26 last Friday.


It opened the day at 57.2, better than its 57.44 start in the previous session.


It traded between 57.37 and 57.2, resulting in an average of 57.31.


Volume reached USD527.82 million, lower than the previous session’s USD650.18 million.


Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said the peso posted correction partly due to “hawkish signals from some Fed officials that also supported market expectations of another but smaller +0.50 Fed rate hike” on Dec. 14.


However, Ricafort said this factor was countered by the drop in global commodity prices, which is seen to help lessen the country’s import bill and decelerate domestic inflation rate.


For Tuesday, he forecasts the peso to trade between 57.20-57.40 against the US dollar


Source: Philippines News Agency