spot_img
28.9 C
Philippines
Sunday, June 16, 2024

PH stocks slump amid lack of catalysts, peso weakening

- Advertisement -

Philippine stocks opened the week in the red amid the lack of catalysts ahead of the long holiday period.

The Philippine Stock Exchange index closed at 6,853.10 Monday, down 28.87 points, or 0.42 percent, while the broader all-shares index lost 9.69 points, or 0.27 percent, to close at 3,578.21.

“Philippine shares were quietly sold down as investors prepare for a shortened week while waiting the quarter-end close,” Regina Capital Development Corp. head of sales Luis Limlingan said.

Philstocks Financial Inc. research analyst Claire Alviar said the weakening of the peso against the US dollar in the past few days also weighed on investor sentiment. The peso closed at 56.39 against the greenback Monday.

Alviar said foreign selling also contributed to the market’s decline as net outflow reached P2476.5 million. Market turnover reached P4.61 billion.

Meanwhile, Asian markets mostly fell on Monday as investors set their sights on the release of key US inflation data due at the end of the week.

After last week’s Federal Reserve projections for interest rates indicated it would cut three times this year, traders are optimistic about the outlook for equities.

However, figures showing the US economy remains in rude health are keeping a lid on sentiment and raised concerns that the central bank might not be able to bring borrowing costs down as quickly as hoped.

Those concerns were echoed by Atlanta Fed chief Raphael Bostic on Friday, when he said he saw inflation remaining sticky and saw just one rate cut this year, instead of the two he had previously foreseen.

Eyes are now on the release of the personal consumption expenditures (PCE) index, the Fed’s preferred gauge of inflation, with traders hoping for a reading that shows price gains slowing further.

The report follows recent data on consumer and producer prices, which came in higher than forecasts.

Still, Stephen Innes at SPI Asset Management said: “Investors have shifted their focus away from the exact number of rate cuts the Fed will implement this year or the timing thereof.

“What matters more is the clear signal that the trajectory of policy rates is downward, not upward, from here.”

Hong Kong, Tokyo, Shanghai, Seoul, Singapore, Taipei, Manila, Jakarta and Bangkok all fell, though there were gains in Sydney and Wellington.

London was flat at the open, while Paris fell and Frankfurt edged up.

The stuttering start to the week came after the Nasdaq chalked up a record for the third straight day.

There was little reaction to Chinese Premier Li Qiang’s comments downplaying worries about the world’s number two economy and pledges of more support to kickstart growth.

The remarks come as leaders struggle to reinvigorate growth engines but refuse to unveil any bazooka-like stimulus measures.

“Just saying the risks are not as much as people think is not going to draw investors back,” Vey-Sern Ling at Union Bancaire Privee said.

“China is not just a ‘show me’ story for investors, it’s a ‘show me a lot more than I expect’ story.”

On currency markets, the yen strengthened after Japan’s top currency official Masato Kanda said he was ready to support the unit against excessive moves.

He said the recent softness “is not in line with fundamentals and is clearly driven by speculation”, adding that “we will take appropriate action against excessive fluctuations, without ruling out any options”. With AFP

LATEST NEWS

Popular Articles