MANILA – Philippine shares ended the week on a positive note despite worries on the rising coronavirus disease 2019 (Covid-19) in the country while the peso weakened against the US dollar.
The Philippine Stock Exchange index (PSEi) ended the week’s trading at 5,793.94 points, up 1.005 percent or 56.67 points.
All Shares also closed with gains increasing by 0.03 percent, or 0.87 points, to 3,493.64 points.
It was, however, a mix among the sectors, with Financials, Services, and Holding firms rising by 3.79 percent, 3.42 percent, and 1.30 percent, respectively.
On the other hand, Mining and Oil fell 4.72 percent; Property, 2.50 percent; and Industrial, 0.65 percent.
Volume reached 950.23 million shares amounting to PHP10.72 billion.
Decliners led gainers at 139 to 87, while 36 shares were unchanged.
Meanwhile, the peso depreciated against the greenback to 51.03 from its 50.85 close a day ago.
It opened the day at 51.25, weaker than its 50.65 close a day ago.
It traded between 51.31 and 50.85, resulting in an average of 51.18.
Volume totaled to USD1.42 billion, up from the USD1.38 billion a day ago.
In a reply to e-mailed questions from Philippine News Agency, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said the peso closed Friday to its weakest in more than two weeks after ending 51.035 on February 26, 2020.
Ricafort traced the peso’s performance for the day partly to “the positive turnaround in the local stock market today: from sharp declines of more than -10 percent earlier today to close with a gain of +1 percent.”
He, however, said that despite the recovery of the main equities index for the day, it is still among the lowest in more than six years or since December 16, 2013.
Among the risks to the peso during the day is the government’s decision to place Metro Manila under one-month community quarantine starting March 12 to contain the further rise of coronavirus diseases (Covid-19) cases.
Ricafort said the quarantine “could lead to slower economic growth and some stockpiling by households of food and other basic commodities (and) could lead to some pick up in prices/inflation.”
He, however, cited the lower global oil prices as a counter factor to possible price upticks in Metro Manila since drop in oil prices in the international market could result in “some rollback in local fuel pump prices in the coming days, as well as narrower oil imports and narrower trade deficit.”
Another negative factor for the peso during the day is the global risk aversion due to continued sell-off in US and global stock market and preference for safe haven assets like the US dollar.
He forecasts the peso to trade between 50.80 to 51.25 next week due to volatilities in US and global bourses.
Ricafort said the peso can receive some cushion from the widely expected cut in the Bangko Sentral ng Pilipinas’ (BSP) key policy rates during the rate-setting meeting of the central bank’s policy-making Monetary Board (MB).
“Peso exchange rate could also be affected by latest developments on coronavirus as well as any further government measures vs. the coronavirus,” he added. (PNA)