Philippine stocks resumed their decline on Wednesday, with the Philippine Stock Exchange Index (PSEi) closing at 6,307.84, down 2.13 percent 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 percent to 3,485.62, reflecting widespread weakness across the market as concerns over higher oil prices dampened investor sentiment.

All sectors in negative territory

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

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

Peso weakened futher

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

Recent trading data shows Brent crude at around $83.80 per barrel and West Texas Intermediate at about $76.60, roughly $10 to $15 higher than levels before the conflict escalated.

Demand for dollars from fuel importers

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 US Treasury yields, with the 10-year note hovering near 4.2 percent, supported the dollar and drew capital toward US assets.