Peso strengthens; PSEi nearly falls below 6,000

THE peso gained against the dollar on Tuesday, but the stock market came close to dropping below 6,000 as investors continued to await Federal Reserve (Fed) and Bangko Sentral ng Pilipinas (BSP) policy decisions.

The currency strengthened by 11 centavos to P56.755:$1, a result Rizal Commercial Banking Corp. chief economist Michael Ricafort came as the greenback weakened due to mostly softer US economic data.

The peso opened at P56.71:$1 and ranged from P56.7 to P56.83.

The benchmark Philippine Stock Exchange index, meanwhile, plunged by 76.60 points, or 1.25 percent, to 6,047.9, its lowest close since Oct. 24, 2022’s 6,028.78.

The broader All Shares dropped by 1.06 percent, or 34.94, points to close 3,274.30.

“Philippine investors sold and kept cash as investors readied for the upcoming two-day policy meeting of the Fed,” Regina Capital Development Corp. Managing Director Luis Limlingan said.

Claire Alviar, assistant research manager at Philstocks Financial, said the bourse reached a new low for the year “as foreign investors continued to exit the market, posting a net selling of P566.33 million.”

“This month, net foreign selling totaled nearly P4.7 billion, with not a single day witnessing net foreign buying,” she added.

“The market remained weak, with a net market value turnover of P3.5 billion, as many investors stayed on the sidelines ahead of the Federal Reserve meeting.”

China Bank Capital Corp. Managing Director Juan Paolo Colet said the PSEi “fell to its lowest close in more than a year on concerns that rising oil prices and other inflationary pressures will force the BSP and Federal Reserve to keep policy rates elevated for longer.”

“Both central banks are widely expected to hold rates steady during their meetings this week, but growing uncertainty about the path of interest rates over the next several months has soured investor sentiment on local equities,” he added.

All sectoral indices closed in the red with property down the most by 2.18 percent.

A little over 596.6 million shares worth some P3.65 billion changed hands.

Decliners outnumbered advancers, 128 to 62, while 43 remained unchanged.