Trade tensions continue to dampen local markets’ performance

The local currency ended Wednesday at 54.13, its weakest after the 54.155 on December 2, 2005. It shed Php0.19 from its 53.94 close a day ago. (Pixabay photo)

MANILA — External developments continue to contribute to the weakness of both the Philippine peso, which fell to its weakest since December 2005, and the Philippine Stock Exchange index (PSEi).

The local currency ended Wednesday at 54.13, its weakest after the 54.155 on December 2, 2005. It shed Php0.19 from its 53.94 close a day ago.

A trader said trade tensions continue to scare investors, thus, the choice for safe haven assets like the US dollar.

For the day, the peso opened at 53.9, little changed from the 53.94 a day ago.

It traded between 53.89 and 54.14, resulting to an average of 54.009.

Volume reached USD772.5 million, higher than the USD434.1 million in the previous session.

The Philippine Stock Exchange index (PSEi) further gave up 0.92 percent, or 68.81 points, to 7,449.20 points.

All Shares followed after it declined by 0.44 percent, or 20.12 points, to 4,577.16 points.

It was a mix between the sectors but most mirrored the main gauge, with the Industrial down by 1.75 percent and was followed by the Financials, 1.42 percent; Holding Firms, 1.11 percent; and Property, 0.17 percent.

On the other hand, Mining and Oil and Services rose by 1.46 percent and 0.31 percent, respectively.

Volume reached 1.17 billion shares amounting to PHP5.67 billion.

Decliners led advancers at 101 to 83 while 56 shares were unchanged.

Landbank market economist Guian Angelo S. Dumalagan said renewed trade tensions soured investors’ sentiment after China formally sought the World Trade Organization’s (WTO) permission to levy tariff amounting to USD7 billion a year against the US.

Adding to the bad news was the rise in crude oil prices due to impact of hurricanes entering the US and the Gulf of Mexico. The price of West Texas Intermediate (WTI) rose 2.9 percent as Hurricane Florence hammered US’ East Coast.

This was aggravated by the prospect of further supply reduction following US sanctions on Iran, which will limit the Middle Eastern country’s oil export.