THE Philippine Stock Exchange index (PSEi) extended its decline on Monday, slipping 0.21 percent to 5,843.79, with the peso likewise losing ground against the dollar, as heightened geopolitical tensions in the Middle East weighed on investor sentiment.
The local currency weakened by 3.1 centavos to close at P62.78 to the dollar on Monday from Friday’s P62.749:$1.
Japhet Tantiangco, research manager at Philstocks Financial Inc., said the market was pressured by the latest developments in the Middle East, particularly following the recent Houthi attacks on Saudi Arabia and the fresh exchange of threats between the United States and Iran.
Elevated global oil prices, rising local Treasury yields and the peso’s lingering weakness also weighed on the local bourse.
Trading remained tepid, with net value turnover reaching P5.61 billion. Foreign investors were net sellers, recording net outflows of P860.88 million.
Luis Limlingan, head of sales at Regina Capital Development Corp., noted that selling pressure remained intact although the PSEi held firm around the 5,800 level.
He said investors remained cautious as the continuing exchange of threats between the US and Iran has led to heightened geopolitical uncertainty. Concerns over a possible fresh spike in crude oil prices also kept local sentiment subdued because of its potential impact on inflation and economic growth.
The market ended with 78 gainers, 115 decliners, and 62 stocks unchanged.
Only the conglomerates sector closed higher, gaining 1.76 percent. The rest declined, with industrials posting the steepest loss at 1.50 percent.
Ayala Corp. was the day’s index leader, rising 5.13 percent to P533. Semirara Mining and Power Corp. was again the main index laggard, plunging by another 7.02 percent to P16.70.
Rizal Commercial Banking Corp. chief economist Michael Ricafort said the peso remained weak amid continued strong demand for the US dollar.
The local currency opened at P62.75 and traded between P62.74 and P62.84 during the session. Trading volume dropped to $1.044 billion from $1.507 billion in the previous session.
The US Federal Reserve’s recent rate hike is said to be making dollar assets more attractive to global investors, with the widening US-Iran conflict seen further supporting the greenback as a safe-haven asset amid global uncertainty.
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