Shares down; peso up

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Share prices closed lower Tuesday as many investors stayed on the sidelines while waiting for a positive catalyst.

The Philippine Stock Exchange index (PSEi) was down 48.72 points, a 0.8 percent drop to 6,039.72. The broader All Shares index was down 18.37 points or 0.56 percent to 3,284.69.

Losers edged gainers 100 to 57 with 72 shares unchanged. Trading turnover reached P2.57 billion.

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Claire Alviar, analyst at Philstocks Financial Inc., noted that “concerns regarding the Israel-Hamas conflict, high-interest rates, and elevated inflation continue to exert downward pressure on sentiment.”

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., noted that the market is now down 8 percent on a year to date basis, since closing 2022 at 6,566.39.

The local currency, meanwhile, closed at 56.76 to the dollar, up from 56.84 on Moday. The currency opened at 56.78, hitting a high of 56.705 and a low of 56.79. Trading turnover reached $1.06 billion.

The Thai baht and South Korean won led sharp gains among Asian currencies on Tuesday as a pull-back in the benchmark 10-year US Treasury yield improved sentiment while investors awaited economic data from the US later in the week.

The yield on the benchmark 10-year US Treasury note briefly rose above 5 percent on Monday before quickly declining. In Asian hours, the yield was up 1 basis point to 4.848 percent on Tuesday.

Yields slumped amid volatility on the back of expectations that the US Federal Reserve will keep rates higher for longer than anticipated.

“Overnight softening of the greenback is poised to offer respite to Asian currencies, particularly those that plummeted past last year’s lowest values,” said Philip Wee, senior FX strategist at DBS Group.

The baht was the top gainer, rising 1 percent and hovering near its highest level since Sept. 22.

“The rise in the baht is in line with the pullback in US Treasury yields,” said analysts at Maybank in a note.

“High gold prices look to also be giving support to the baht,” they added while expecting the USD/THB pair to range trade around 36.0-37.0 in the near term.

Thailand’s currency has been one of the worst performers in 2023 and has fallen 4.5 percent this year, but it has gained 0.7 percent in October.

South Korea’s won was also one of the top gainers against a falling dollar, touching its highest since Oct. 12.

Maybank analysts see a potential for the dollar-won pair to consolidate around the 1325 to 1375 range.

South Korea’s key policy rate is at a near 15-year high of 3.5 percent, with the central bank last week standing pat for the sixth meeting.

South Korea will report its advance estimates for third-quarter gross domestic product on Thursday.

The Indonesian rupiah gained about 0.3 percent against the dollar, snapping a four-day losing streak.

Indonesia’s President Joko Widodo said the rupiah’s recent rate of depreciation against the dollar was still “safe” for Southeast Asia’s largest economy and its inflation targets.

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Bank Indonesia unexpectedly raised interest rates last week to arrest the rupiah’s decline amid US monetary tightening and rising geopolitical risks.

India markets were closed for a public holiday.

Most actively traded Bank of the Philippine Islands was down P1.60 to P100.60.

International Container Terminal Services Inc. was down P3 to P202. BDO Unibank Inc. was up P1 to P127.40. Ayala Land Inc. was up P0.25 to P28.40. PLDT Inc. was down P16 to P1,204. Universal Robina Corp. was steady at P113.50. SM Investments Corp. was steady at P811. Ayala Corp. was down P7 to P602. GT Capital Holdings Inc. was down P8.50 to P537. SM Prime Holdings Inc. was down P0.70 to P30.20. – Ruelle Castro

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