The peso ended higher yesterday, echoing movements of most Asian currencies, as the dollar hovered below a two-decade peak.
Share prices ended lower Wednesday on heightened risk aversion.
The Philippine Stock Exchange index (PSEi) was down 106.62 points to 6,583.65, a 1.59 percent drop.
The broader all shares index was down 47.78 points to 3,500.72, a 1.35 percent drop.
Losers edged gainers 128 to 67 with 42 stocks unchanged. Trading turnover reached P8.87 billion.
The peso closed at 56.145 to the dollar, up from 56.225 on Tuesday. The currency opened at 56.20, hitting a high of 56.11 and a low of 56.21. Trading turnover reached $810.71 million.
“The local index stretched its losing streak to close the month on the Fed’s remarks that it will raise its interest rates still to temper inflation despite potentially negative impacts on the economy and corporate profits,” said Luis Limlingan, managing director at Regina Capital and Development Corp.
“More recently, New York Fed President John Williams called for a ‘somewhat restrictive policy to slow demand’,” he added.
Claire Alviar, analyst at Philstocks Financial Inc. said the market traced the overnight drop in Wall Street.
Most actively traded SM Prime Holdings Inc. was up P0.95 to P37.85. Interantional Container Terminal Services Inc. was down P2.80 to P181.20. Bank of the Philippine Islands was up P0.55 to P94.95. Converge ICT Solutions INc. was down P0.56 to P17.40. AC Energy Corp. was up P0.23 to P7.50. Ayala Land Inc. was down P0.25 to P28.65. BDO Unibank Inc. was down P2.60 to P128.80. Solar Power Nueva Ecija Corp. was steady at P1.69. SM Investments Corp. was down P44.50 to P831.
Most Asian emerging currencies edged higher on Wednesday against a softer dollar, while Thailand’s baht and stocks outperformed several regional peers after the government signaled higher economic growth this year.
The baht reversed course to rise 0.3 percent after the economy was forecast to grow 3 percent-3.5 percent this year, with a slow but steady recovery as the crucial tourism sector picks up and exports remain good.
“The outlook for THB looks good as tourist arrivals appear to be picking up, plus the Bank of Thailand (BoT) has commenced rate hikes,” said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.
The BoT raised its key interest rate by 25 basis points earlier this month for the first time in nearly four years and is expected to hike rates again at its next meeting on Sept. 28.
Thailand, the second-largest economy in Southeast Asia, will release its July current account data later in the day.
The dollar index, which measures the greenback against a basket of currencies, dropped 0.2 percent despite the prospect of higher rates for longer and lifted Asian emerging currencies.
“There is some correction to the US dollar today, led by the Chinese yuan after slightly better-than-consensus China purchasing managers’ index data and another lower-than-expected USD/CNY fix,” said Alvin Tan, head of Asia FX strategy at RBC Capital Markets.
“Month-end flows are also weighing on the US dollar after its recent surge.”
South Korea’s won strengthened 0.5 percent and was the top gainer in the region. China’s yuan and Singapore’s dollar firmed 0.3 percent and 0.2 percent, respectively. –Ruelle Albert Castro, Reuters
