PSEI down 0.68%, peso at P56.22

AFTER six consecutive days of a market rally, the local bourse dropped by 45.79 points (0.68 percent) to settle at 6,734.99.

The broader All Shares also went down on Thursday by 12.95 points (0.37 percent) to close at 3,501.03.

Claire Alviar, research associate at Philstocks Financial Inc., said that investors booked gains for the day as the Bangko Sentral ng Pilipinas’ inflation forecast of 7.4 to 8.2 percent in November, somehow weighed on sentiment.

“The median of 7.8 percent remains higher than last month’s 7.7-percent inflation rate. Meanwhile, we bucked the trend in Asia following the signal of the Federal Reserve (Fed) of a slowdown in hiking rates, but despite the decline, the local bourse was still able to stay above 6,700 levels,” Alviar added.

“The Philippine Stock Exchange Composite index (PSEi) corrected lower today, considered healthy downward correction, after mostly softer US economic data and slower China manufacturing data, which is in contraction mode amid some continued lockdowns in China due to the highest new Covid cases since the pandemic started recently,” said Michael Ricafort, chief economist at Rizal Commercial Banking Corp.

This, as the peso closed at P56.22 to a US dollar on Thursday, its best finish in over two months.

Trading opened at P56.45 and ranged from P56.1 to P56.45. The total volume for the day was $898.7 million, lower than the $1.030.19 billion in the previous session.

The peso appreciated “after the US dollar continued to softer versus major global currencies amid mostly softer US economic data recently that could support moderate/smaller future Fed rate hikes,” said Ricafort.

He also mentioned that the latest healthy profit-taking of the PSEi was also due to latest signals from Federal Reserve Chairman Jerome Powell of a possible smaller Fed rate hike in December 2022.

For US economic catalysts, Regina Capital Development Corp. Managing Director Luis Limlingan said that investors’ focus on the much-anticipated November jobs report due out Friday as the payrolls report is expected to provide more clarity on the labor market, and whether it continues to cool.

“Economists surveyed by Dow Jones estimate the economy added 200,000 jobs in November, down from 261,000 additions in October. They also anticipate that the unemployment rate held steady from the prior month at 3.7 percent,” Limlingan explains.

On the local front, the latest Philippine PMI reading still showed improvement for the month of November, but now attention will be on inflation which will come out in a few days.

Around 796.42 million shares worth around P10.11 billion changed hands as investors’ participation was strong, recording a net market value turnover of P9.54 billion.

Sectoral indices closed mixed, with mining oil leading the gainers, up 3.22 percent, while properties dropped the most, plunging by 3.75 percent.

Advancers edged decliners, 112 to 77, while 40 securities remained unchanged.