PSEi drops 2.13% as oil fears grow

Philippine stocks resumed their decline on Wednesday, with the Philippine Stock Exchange Index (PSEi) closing at 6,307.84, down 2.13% or 137.54 points, as broad-based selling pressure weighed on most sectors. Fears over spiking oil prices continued to weaken overall market sentiment, with investors trimming positions throughout the day ahead of the inflationary pressures expected from the Iranian conflict.

The broader All Shares Index likewise fell 2.03% to 3,485.62, reflecting widespread weakness across the market as concerns over higher oil prices dampened investor sentiment.

All sectors ended in negative territory. Mining & Oil posted the steepest drop, plunging 6.37% to 18,252.96, followed by Financials (-3.01%), Property (-2.49%), Holding Firms (-2.47%), Industrial (-2.43%), and Services (-0.56%).

Market breadth remained heavily negative, with 179 decliners against just 35 advancers, while 58 issues were unchanged. Trading activity picked up, with net value turnover reaching P8.67 billion on 4.50 billion shares traded across 127,454 deals.

Among notable index movers, ICT bucked the trend, rising 0.85% to P715.00, while most heavyweights declined. DigiPlus (PLUS) slid 8.33% to P16.94, BDO fell 4.47% to P126.10, URC dropped 5.53% to P71.80, Ayala Land lost 3.61% to P20.00, and Jollibee declined 3.07% to P195.60, reflecting continued risk-off sentiment among investors.

Meanwhile, the peso weakened further to P58.57 per dollar, depreciating from Tuesday’s close of P58.43. The decline came as the U.S. dollar strengthened broadly in global foreign exchange markets, with the U.S. Dollar Index holding near the 104 level amid persistent geopolitical risks and expectations of prolonged elevated U.S. interest rates.

Recent trading data shows Brent crude at around $83.80 per barrel and West Texas Intermediate (WTI) at about $76.60, roughly $10 to $15 higher than levels before the conflict escalated. Higher oil prices typically pressure the Philippine peso since the country is a net oil importer, increasing demand for dollars from fuel importers.

At the same time, stronger U.S. Treasury yields, with the 10-year note hovering near 4.2%, supported the dollar and drew capital toward U.S. assets. This combination of safe-haven dollar demand, higher oil prices, and global risk aversion contributed to the peso’s further depreciation during the session.