PSEi retakes 5,700 as peso strengthens from record low

The Philippine Stock Exchange Index (PSEi) rose 90.60 points, or 1.61 percent, to 5,700.99 on Friday, while the peso strengthened 9.9 centavos, or 0.16 percent, to P62.801 per US dollar from Thursday’s record-low close of P62.90, as bargain hunting lifted equities after a steep selloff and easing oil prices offered some relief to global markets.

Market recovery

The local market recovered after Thursday’s 2.20-percent plunge, with investors picking up stocks following the recent decline. Global markets also found support from lower oil prices after US President Donald Trump said Washington would not attack Iran before the November midterm elections, easing near-term concerns over potential disruptions to energy supplies. However, uncertainty over inflation and interest rates continued to weigh on sentiment.

Investors remained cautious after Philippine inflation accelerated to 7.2 percent in September from 6.1 percent in August, raising expectations of further monetary tightening by the Bangko Sentral ng Pilipinas (BSP). Minutes from the US Federal Reserve’s September meeting also showed that most officials considered another rate increase likely appropriate by year-end, keeping borrowing costs and the dollar in focus.

The rebound was broad-based, with all six PSE sectors advancing. Mining and Oil led with a 2.80-percent gain, followed by Services at 2.36 percent, Industrials at 2.33 percent, Financials at 1.50 percent, Property at 0.79 percent and Holding Firms at 0.62 percent.

Turnover reached P4.73 billion, while foreign investors remained net sellers with P133.08 million in outflows. DigiPlus Interactive Corp. led index gainers, surging 12.47 percent to P8.21. SM Investments Corp. was the biggest laggard, declining 1.44 percent to P515.

Peso recovered but remains under pressure

The peso recovered from Thursday’s record-low close but remained under pressure from elevated global interest-rate expectations and domestic inflation concerns. It opened at P62.75 and traded between P62.735 and P62.90 before closing at P62.801.

The BAP AM weighted average was P62.797, while the PM weighted average eased to P62.789, indicating modest strengthening in afternoon trading. The full-day BAP weighted average stood at P62.793, while the FX settlement rate was P62.797.