PSEi, peso rebound as oil prices retreat
The Philippine Stock Exchange Index (PSEi) rose 38.23 points, or 0.67 percent, to 5,716.15 on Tuesday, while the peso strengthened 40 centavos, or 0.63 percent, to P62.91 per US dollar from Monday’s P63.31 close, as bargain hunting and easing global oil prices supported a recovery in local assets.
The PSEi rebounded after two consecutive sessions of losses, with investors picking up shares following the recent market decline. The broader All Shares index gained 0.65 percent. Trading was active, with market value turnover reaching P7.21 billion, although foreign investors remained net sellers, recording P183.81 million in outflows.
All sectoral indices advanced except Services, which fell 0.99 percent. SM Investments Corp. led index gainers, surging 6.64 percent, while DigiPlus Interactive Corp. was the main laggard, declining 6.35 percent.
Peso extends recovery
The peso also extended its recovery, reversing Monday’s loss and moving farther away from its recent record lows above P64. It opened at P63.10, reached an intraday high of P63.13 and weakened to a low of P62.895 before closing at P62.91.
The morning weighted average was P63.092 on volume of $796 million, while the afternoon average eased to P62.999 on $1.0345 billion. The full-day weighted average stood at P63.04, with total spot volume reaching $1.8305 billion. The FX settlement rate was P63.092.
The peso’s gain coincided with a sharp retreat in global oil prices. Brent crude fell 5.85 percent on Monday to $92.57 a barrel, then slipped further on Tuesday after US President Donald Trump said he would hold off on additional military strikes against Iran while diplomatic efforts continued.
Brent was trading at $90.99 on Tuesday, while US West Texas Intermediate fell to $85.20. The decline eased concerns about a prolonged disruption to Middle East oil supplies and reduced the immediate pressure on the Philippines’ import bill.
Ease in oil prices
The easing in oil prices followed a broader repricing of geopolitical risk after the US midterm elections, in which Democrats won control of both chambers of Congress.
Market participants viewed the result as potentially increasing pressure on the Trump administration to end the conflict with Iran. Philippine market analysts had previously linked the peso’s move back below P63 to a combination of lower oil prices, softer US Treasury yields and a weaker dollar following the election outcome.