THE peso and stock market both retreated on Tuesday, with sentiment said to have been affected by renewed US strikes against Iran.
The currency weakened by nine and a half centavos to 61.56 against the dollar, while the benchmark Philippine Stock Exchange index (PSEi) shed 46.14 points, or 0.77 percent and ended the day at 5,963.24.
The broader All Shares also fell, by 17.94 points or 0.53 percent, to 3,353.94.
The peso opened at P61.45:$1 and ranged from P61.405 to P61.65. Volume slid to P1.67 billion from P1.80 billion a day earlier.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the currency weakened as the US strikes led to the dollar strengthening against major global currencies.
Stock market analysts said sentiment weakened after hopes for a peace agreement faded following Washington’s “self-defense” strikes against Iran, reigniting worries over the conflict’s economic impact.
Investors also stayed wary over the possibility that domestic inflation could climb beyond 8 percent, fueling speculation of a larger-than-expected 50-basis-point rate hike from the Bangko Sentral ng Pilipinas.
Trading activity remained subdued, with net value turnover reaching P4.29 billion. Foreign investors were net sellers with outflows amounting to P820.16 million.
Japhet Tantiangco, research manager at Philstocks Financial Inc. said largely stayed on the sidelines amid stagflation risks and lingering uncertainties surrounding the geopolitical situation.
Regina Capital Development Corp. head of sales Luis Limlingan said rate hike worries had reduced the appeal of equities and pushed investors toward a risk-off stance.
Sectoral performance was mixed, with mining and oil stocks leading gains at 1.42 percent, while services posted the steepest decline at 2.72 percent.
WITH A REPORT FROM NIÑA MYKA PAULINE ARCEO
