Philippine shares fall as peso slides to new all-time low

Philippine shares closed lower on Wednesday as the peso finished at a new record low amid renewed inflation concerns, with reignited hostilities between the United States and Iran pushing up global oil prices.

The Philippine Stock Exchange index (PSEi) dropped by 0.67% or 40.66 points to close at 6,053.23, while the broader all shares index fell by 0.31% or 10.58 points to end at 3,352.61.

“The local market slipped back into the red, tracking weakness in regional and US markets as escalating US-Iran tensions and rising oil prices weighed on investor sentiment,” COL Financial Group Research Analyst Denise Joaquin said in a Viber message. “Global oil prices climbed further above USD 90/bbl (per barrel) amid renewed US strikes on Iran and concerns over further disruptions to oil flows through the Strait of Hormuz, while the peso continued to hover near record lows.”

“The local market pulled back due to the rise in global yields and oil prices amid the renewed military exchanges between the US and Iran. The fall of the peso to a new record low also contributed to the market’s decline today,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

On Wednesday, the peso finished at a new all-time low for the fourth straight session, closing at PHP 62.565 against the dollar. This was down 16.5 centavos from Tuesday’s close. The currency also hit a new worst intraday showing on record of PHP 62.69.

Asian stocks slumped on Wednesday after renewed US airstrikes on Iran pushed oil prices to a five-week high and drove the US 10-year Treasury yield to its highest level in almost three years, extending a bond market sell-off across global markets, Reuters reported.

MSCI’s broadest index of Asia-Pacific shares outside Japan tumbled 2% as South Korea’s KOSPI dropped almost 4%, while the Nikkei 225 was down 2.9%. S&P 500 e-mini futures were down 0.1%.

Brent crude futures extended gains into a second day as trading resumed in Asia, rising 0.9% to USD 95.45 a barrel after the US launched a barrage of airstrikes on Iran on Tuesday, which earlier pushed oil prices to a five-week high.

Majority of sectoral indices closed in the red. Services decreased by 1.46% or 48.07 points to 3,253.53; financials went down by 0.41% or 7.89 points to 1,917.45; property retreated by 0.34% or 6.41 points to 1,859.09; holding firms dropped by 0.29% or 12.70 points to 4,328.69; and mining and oil declined by 0.16% or 31.45 points to 19,798.30.

Meanwhile, industrial went up by 0.38% or 29.68 points to 7,848.31.

Decliners outnumbered advancers, 101 to 79, while 65 names were unchanged.

Value turnover decreased to PHP 5.69 billion on Wednesday with 610.46 million shares traded from the PHP 10.47 billion with 1.88 billion issues on Tuesday.

Net foreign selling increased to PHP 559.82 million from PHP 92.52 million in the previous session. — Alexandria Grace C. Magno with Reuters