PSE index declines as markets eye US-Iran talks

Philippine stocks closed in the red again on Monday amid uncertainty over the conflict in the Middle East amid mixed signals from officials about ceasefire discussions.

The benchmark Philippine Stock Exchange index (PSEi) fell by 0.83% or 50.35 points to close at 5,948.33, while the broader all shares index went down by 0.49% or 16.61 points to end at 3,336.99.

“The local market declined as the latest developments in the Middle East conflict including the US’ military strikes on Iranian infrastructure and further threats from US President Donald Trump if the Strait of Hormuz is not fully reopened cast doubts on the possibility of the war ending soon,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

“The PSEi opened the week lower as developments in the Middle East conflict continued to weigh on market sentiment. Market jitters intensified after Donald Trump set a deadline for Iran to open the Strait of Hormuz, adding to global uncertainty,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message. “Oil prices remained elevated due to continued supply disruptions tied to the prolonged conflict.”

Oil prices rose while stocks were mixed on Monday after Mr. Trump warned of “hell” for Iran unless it reopens the Strait of Hormuz by his self-imposed deadline, but a report of a push for a ceasefire appeared to ease some nerves, Reuters reported.

Mr. Trump’s repeated threats to destroy civilian infrastructure including power plants and bridges if the vital waterway is not open by Tuesday have put traders on edge for reciprocal attacks by Iran on targets in the Gulf states.

Investors took some confidence after Axios reported that the US, Iran and a group of regional mediators are discussing the terms for a potential 45-day ceasefire that could lead to a permanent end to the war, citing four US, Israeli and regional sources with knowledge of the talks.

Brent crude futures opened higher before paring gains, rising 1.2% to $110.29 a barrel on the potential supply disruption.

Majority of sectoral indices ended lower on Monday. Mining and oil slid by 2.99% or 501.88 points to 16,271.46; holding firms sank by 1.93% or 91.52 points to 4,632.12; services dropped by 1.12% or 30.74 points to 2,691.24; financials retreated by 0.35% or 6.72 points to 1,874.52; and industrials went down by 0.09% or 8.02 points to 8,784.82.

Meanwhile, property edged up by 0.01% or 0.36 point to 1,988.07.

Decliners outnumbered advancers, 125 to 70, while 70 names closed unchanged.

Value turnover went down to PHP 5.55 billion on Monday with 816.79 million shares traded from the PHP 7.97 billion with 1.18 billion issues that changed hands on Wednesday.

Net foreign selling decreased to PHP 1.05 billion from the PHP 1.2 billion in the previous session. — Alexandria Grace C. Magno with Reuters