THE peso returned to P57:$1 territory on Monday, closing at an over four-month high, but the stock market fell for a third straight day ahead of the Chinese New Year break.
The currency gained by 3.4 centavos to P57.986 to the dollar. It ranged from P57.95 to P58.02 — Friday’s close — while volume dipped to $896 million from $1.34 billion.
A trader said the peso strengthened as Asian foreign exchange markets stayed quiet due to holiday-thinned liquidity.
“The peso has been slightly firmer off last week’s highs,” the trader noted.
“But without fresh macro catalysts the move feels more like range-bound consolidation than breakout, and traders are watching US data and BSP guidance for any shift in momentum.”
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the peso gained strength following record-high monthly remittances from overseas Filipino workers (OFWs).
In contrast, the benchmark Philippine Stock Exchange composite index shed 16.03 points, or 0.25 percent, to 6,368.55 with investors said to have booked profits ahead of the Bangko Sentral ng Pilipinas (BSP) policy meeting on Thursday.
“The local index corrected lower after hitting highs not seen in seven to nine months, which we view as healthy profit-taking,” Ricafort said.
He added that despite the pullback, the PSEi has consistently traded above 6,000 for more than two months, reflecting sustained market resilience.
Japhet Tantiangco, research manager at Philstocks Financial Inc., said trading was subdued with net value turnover at P4.22 billion, below the year-to-date average of P6.35 billion. Foreigners were net sellers with outflows of P90.8 million.
Only the banking sector posted gains, rising 0.13 percent, while industrials led the declines with a 0.89-percent drop. Decliners outnumbered advancers, 140 to 79.
The day’s top performer was Century Pacific Food, Inc., up 2.63 percent to P39.00, while Semirara Mining and Power Corp. was the worst performer, plunging 21.39 percent to P26.10 after the Department of Energy, following a Department of Justice opinion, said the company’s coal contract could not be renewed.
“Investors remained cautious despite expectations of another BSP rate cut,” said Luis Limlingan, managing director of Regina Capital Development Corp.
Positive factors supporting the market include record-high OFW remittances and the peso’s strengthening, he added.
Ongoing governance reforms and anti-corruption measures could further boost investor confidence, Ricafort said.
Philippine financial markets will be closed today for Chinese New Year. Trading will resume on Wednesday.