Peso returns to P55:$1; stock market dips 0.10%

By Ed Paolo Salting and Niña Myka Pauline Arceo | The Manila Times
May 19, 2023

THE peso ended a run of declines and returned to the P55:$1 level on Thursday, but the stock market dipped as investors ignored a widely expected Monetary Board decision to hold off from raising interest rates further.

The currency strengthened by 33 centavos to close at P55.87 against the dollar, while the benchmark Philippine Stock Exchange index (PSEi) shed 6.47 points, or 0.10 percent, to end the day at 6,628.64.

The broader All Shares went the opposite direction but by less than a point — 0.80, or 0.02 percent — to close at 3,534.64.

“On Thursday, investors seemed to take profits in the session as the index ended in the red,” Regina Capital Development Corp. Managing Director Luis Limlingan said.

Claire Alviar, research associate at Philstocks Financial Inc., said “local market sentiment did not get a boost by the decision of the BSP (Bangko Sentral ng Pilipinas) as investors had already factored in the pause in interest rate hikes.”

“The net market value turnover remained weak at P3.75 billion,” she added.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said that “despite the decline there are still some offsetting positive factors for the PSEi such as the widely expected pause in local interest rates…”

“Moreover, US President [Joe] Biden, before departing for Japan, expressed confidence a deal on the US debt ceiling will be reached as US House Speaker Kevin McCarthy said that an accord this week will be doable,” he added.

As for the peso, Ricafort said the exchange rate corrected amid signals of a possible cut in bank reserve requirements next month.

The currency opened trading at P56.05:$1 and ranged from P55.86 to P56.05. Volume reached $1.228 trillion, much lower than the $1.641 million seen in the previous session.

At the stock market, all but one sectoral index closed higher, with mining and oil gaining the most by 1.03 percent. Closing in the red were holding firms, down 0.67 percent.

Just over 729.9 million shares worth P3.96 billion changed hands.

Advancers led decliners, 90 to 81, while 61 securities remained unchanged.