Share prices ended higher Tuesday on bargain hunting while the pesofell to its lowest in nearly two weeks after reports the Philippines trade deficit widened in March compared to last month.
“The substantial trade gap means that the peso should continue to underperform in the near term,” analysts from ING wrote in a note.
The Philippine Stock Exchange index (PSEi) was up 21.87 points, a 0.33 percent hike to 6,622.61.
The broader all shares index was up 6.69 points or 0.19 percent to 3,532.33.
Losers edged gainers 86 to 73 with 71 stocks unchanged. Trading turnover reached P4.18 billion.
The peso closed at 55.76 to the dollar, down from 55.25 on Monday.
The currency opened at 55.45 and hit a high of 55.40 and a low of 55.78. Trading turnover reached $1.66 billion.
The closely-watched Federal Reserve’s quarterly Senior Loan Officer Opinion Survey on Monday showed that the tightening of credit conditions in US was likely due to the impact of the Fed’s aggressive rate hikes rather than severe banking sector stress.
This had led to some market relief but this “borrowed relief” is hollow consolation in a high rates environment, reining in unadulterated optimism, said Vishnu Varathan, and economist at Mizuho Bank.
Investors are also focused on US inflation data that will be released on Wednesday after Federal Reserve chair Jerome Powell said last week that interest rate policy decisions will be “driven by incoming data,” while signalling a likely pause in the rate hiking cycle.
Juan Paolo Colet, managing director at China Bank Capital Corp., said despite the market closing in the green, many investors in the market turned cautious and remained on the sidelines ahead of US April inflation and country’s first quarter GDP data releases this week.
“With the PSEi treading delicately close to its 6,600 support, the market will need positive catalysts to preserve last week’s gains and encourage another attempt at the 6,700 resistance zone,” Colet said.
“Barring any negative surprises from the US debt ceiling issue, we expect lower US inflation figures and higher local GDP growth to help boost investor sentiment,” he added.
Most actively traded BDO Unibank Inc. was down P0.90 to P136.10. SM Prime Holdings Inc. was up P0.70 to P34. SM Investments Corp. was up P15 to P935. International Container Terminal Services Inc. was down P3.60 to P206.40. Ayala Corp. was up P2 to P661.50.
Bank of the Philippine Islands was down P0.10 to P105. Universal Robina Corp. was up P3.10 to P153.90. PLDT Inc. was up P7 to P1,207.
