The peso rebounded sharply on Monday while the Philippine Stock Exchange Index (PSEi) climbed back above the 6,000 mark for the first time since mid-May, as easing oil prices and improving global risk appetite lifted sentiment across local financial markets.

The local currency strengthened by 22.5 centavos to close at P61.465 per US dollar from Friday’s P61.69 finish, as investors trimmed safe-haven dollar positions amid signs of easing tensions in the Middle East.

The peso posted its strongest close in several sessions after trading near record lows earlier this month. It opened firmer at P61.35, traded within a P61.35 to P61.535 range, and settled near the stronger end of the session. 

The Bankers Association of the Philippines weighted average improved to P61.437 from P61.594 previously, while the foreign exchange settlement rate strengthened to P61.426 from P61.54, reflecting sustained demand for the local currency throughout the day.

“The peso also appreciated vs. the US dollar after BSP Governor Remolona signaled possible future BSP rate hikes to help stabilize inflation and inflation expectations,” RCBC chief economist Michael Ricafort said. 

Meanwhile, the benchmark PSEi rose 0.80 percent to 6,009.38, reclaiming the psychologically important 6,000 level as investors returned to risk assets.

Market sentiment improved after US President Donald Trump said negotiations with Iran were “progressing seriously,” with both sides “closer than people think” to reaching a framework agreement. 

Reports also indicated that Washington, through Omani mediators, was open to limited increases in Iranian oil exports during negotiations, signaling efforts to avoid another oil price shock while inflation pressures remain elevated globally.

“Qatar and the UAE sent 3 tankers of LNG through the Strait of Hormuz to key buyers. Over 30 other vessels including an Iraqi crude-loaded supertanker have sailed through the Strait of Hormuz in the past day,” Ricafort said.

As geopolitical concerns eased, Brent crude retreated below $100 per barrel after nearing $110 earlier this month.

Lower oil prices boosted sentiment toward oil-importing economies such as the Philippines, where cheaper crude helps temper inflation, narrow trade deficits, and reduce pressure on the peso.

The peso also drew support from broader dollar weakness as the greenback softened globally, allowing Asian currencies including the Korean won, Thai baht, and Philippine peso to recover modestly.

Forex markets likewise reacted positively after Trump said negotiations with Iran were “moving in the right direction” and nearing a possible framework agreement.

Despite the rebound in equities, trading activity remained subdued. Net value turnover reached only P3.26 billion, the lowest so far this year, suggesting investors remain cautious over further geopolitical and market developments. Foreign investors were likewise net sellers, with P238.39 million in outflows.

Banks led sectoral gains, advancing 1.21 percent, while industrials slipped 0.25 percent. Ayala Corp. rose 3.42 percent to P460.00, while DigiPlus dropped 5.48 percent to P12.08.