THE peso weakened by 14 centavos to P60.69 against the dollar on Monday — the second all-time low in as many trading days — as the war in the Middle East entered its fifth week with no resolution in sight.
The benchmark Philippine Stock Exchange index (PSEi) also plunged, shedding 103.44 points, or 1.73 percent, to an over four-month low of 5,8471.41. The broader All Shares closed the day 1.20 percent down, or 40.01 points, to 3,295.85.
The currency opened at its previous all-time low of P60.55:$1, which was hit just last Friday, and touched an intraday record of P60.84. Volume surged to P2.007 billion from P1.336 billion.
Reyes Tacandong & Co. senior adviser Jonathan Ravelas said markets were pricing in a prolonged war, with the peso likely to trade within the P60.60 to P60.90 range.
A trader said “P61 [to the dollar] is possible but not a straight line — [the] market is stretched.”
“Expect choppy trading around P60-P61, not a clean breakout.”
Meanwhile, Philstocks Financial Inc. research manager Japhet Tantiangco said the PSEi opened the shortened trading week on a negative note amid faltering hopes for a diplomatic resolution in the Middle East.
Elevated global oil prices and the peso depreciation continued to raise concerns over the Philippines’ inflation outlook, he noted.
Oil prices rose to above $116 per barrel on Monday after US President Donald Trump said troops could be sent in to seize Kharg Island, Iran’s main oil export hub.
Luis Limlingan, head of sales at Regina Capital Development Corp., said that the prolonged conflict and macroeconomic pressures were continuing to weigh on risk appetite, prompting cautious trading across Philippine markets.
Trading was active at the stock market with net value turnover at P7.31 billion, higher than the year-to-date average of P6.47 billion. Foreign investors were net sellers with outflows of P1.55 billion.
Only the services sector closed in the green, ending the day basically flat at 0.03 percent higher, while the five other sub-indices plunged with banks suffering the steepest loss of 3.25 percent.
Decliners outnumbered advancers, 126 to 74.
DMC Holdings Inc. led the index gainers, climbing 2.78 percent to P9.99, while Ayala Land Inc. was the worst performer, plunging 7.30 percent to P16.26.