MANILA – After a five-day rally, the Philippine Stock Exchange index slipped, and the Philippine peso also ended weaker, following the 50 basis points (bps) increase in the Bangko Sentral ng Pilipinas’ (BSP) key rates on Thursday.
The local bourse’s main index shed 0.72 percent to 5,779.73 points, and the broader All Shares, 0.54 percent to 3,220.96 points.
Most sectoral counters also ended the day in the red, except Mining and Oil, which jumped 0.16 percent.
Services led decliners after contracting by 0.83 percent, followed by Industrial, 0.78 percent; Financials, 0.66 percent; Property, 0.51 percent; and Holding Firms, 0.44 percent.
Volume reached 1.28 billion shares, amounting to PHP8.21 billion.
Losers led gainers at 108 to 64, while 62 shares were unchanged.
Rizal Commercial Banking Corp. (RCBC) chief economist said the higher-than-expected hike in the BSP rates, which brought the central bank’s target reverse repurchase (RRP) rate to its highest in 1.5 years at 5.5 percent, “could lead to higher borrowing costs/financing costs for some listed companies and could slow economic/GDP (gross domestic product) growth.”
The rate hike, he said, came as monetary officials revised their 2027 average inflation forecast upward to 6 percent, from 5.4 percent previously.
Other factors behind the PSEi’s decline include weakness in the local currency, rising crude oil prices in the international market due to developments in the Middle East, and an increase in the government’s budget gap.
Ricafort eyes the PSEi’s initial support level between 5,600 and 5,700 points.
The local currency, meanwhile, ended at its weakest level to date against the US dollar at 63.52, from 63.36 on Wednesday.
Its depreciation showed early on when it opened the day’s trade at 63.31 from 63.01 in the previous session.
It traded between 63.54 and 63.30, bringing the day’s average to 63.41.
Volume rose to USD1.72 billion from Wednesday’s USD 1.34 billion.
Ricafort projects the peso to trade between 63.40 and 63.60 on Friday. (Joann Santiago-Villanueva/PNA)
