Philippine stocks extend slide as peso hits record low

Philippine shares fell for a second session on Wednesday after the peso slid to a record low, weighing on investor sentiment.

The benchmark Philippine Stock Exchange index dropped 0.29% to 6,389.81, while the broader all-share index slipped 0.06% to 3,635.94.

Late selling pulled the market lower, with sentiment pressured by the peso’s weakness and higher global oil prices amid tensions in Iran, Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said.

“The peso’s weakness also weighed on the bourse,” he said in a Viber message.

The local currency closed at PHP 59.44 a dollar, down 9.9 centavos from its previous finish, according to Bankers Association of the Philippines data. This marked its weakest close on record, surpassing the PHP 59.355 logged on Jan. 7.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the decline reflected mild profit-taking after recent gains, following the government’s decision to trim its infrastructure spending target.

The Department of Budget and Management lowered the infrastructure spending goal to 4.3% of gross domestic product this year from 5.1%, citing the need for more cautious disbursement after a corruption scandal weighed on spending and growth last year.

Acting Budget Secretary Rolando U. Toledo said the revised target translates to about PHP 1.3 trillion.

Despite Wednesday’s dip, Mr. Ricafort said the index remains at its highest levels in more than five months, supported by gains since late December and continued foreign inflows.

Sectoral performance was mixed. Mining and oil stocks rose 1.81%, while holding firms gained 1.57% and industrials added 0.58%.

On the other hand, services fell 1.76%, while financials declined 1.2%.

JG Summit Holdings, Inc. led index gainers, climbing 4.8% to PHP 26.20. China Banking Corp. was the worst performer, sliding 3.72% to PHP 60.70.

Decliners beat advancers 97 to 95, with 71 stocks unchanged. Value turnover rose to PHP 6.92 billion, with 1.86 billion shares traded, compared with PHP 6.75 billion and 1.26 billion shares in the previous session.

Foreign investors remained net buyers, though inflows eased to PHP 291.46 million from PHP 506.15 million a day earlier.

Markets also tracked global developments, including softer US equities and higher oil prices, which added pressure on risk assets.

Analysts said the peso’s direction and policy signals from the Bangko Sentral ng Pilipinas would remain key drivers in the near term. — Alexandria Grace C. Magno