Peso holds ground but local stocks head south

MANILA — The Philippine peso continued to show resiliency against the US dollar, but trade war jitters hit the equities market anew, causing the main index to retreat to the 6,900-level on Wednesday.

The local currency finished the trade at 54.18 from 54.24 a day ago, bouyed by what a trader described as the smaller-than-expected trade gap last August.

Trade deficit in the eighth month this year amounted to USD3.51 billion, lower than the previous month’s USD3.55 billion and the median forecast of USD 3.55 billion.

Imports again posted higher growth of 11 percent than export’s 3.1 percent expansion as domestic demand remains robust.

As of end-August this year, trade deficit reached USD26 billion, 68 percent up from year-ago’s USD15.4 billion.

The trader said dollar sell-off during the day contributed to the peso’s positive close.

For the day, the local unit opened at 54.19, sideways from the previous session’s 54.16.

It improved to 54.11 but also touched 54.22 resulting to an average of 54.171.

Volume amounted to USD720.8 million, higher than the USD605 million a day ago.

On the other hand, the Philippine Stock Exchange index (PSEi) gave up 1.17 percent, or 82.76 points, to 6,976.62 points.

The widening of the country’s trade gap, to date, worried investors as this will increase the country’s current account deficit.

Reports about the trade concerns between the US and China added to the risk-off sentiment, the trader said.

The negative close of the PSEi was mirrored by all the counters, with the broader All Shares down also by 1.17 percent, or 50.86 points to 4,284.83 points.

Industrial and Holding Firms both contracted by 1.39 percent and was followed by Financials, 0.90 percent; Property, 0.81 percent; Services, 0.51 percent; and Mining and Oil, 0.11 percent.

Volume improved to 1.3 billion shares amounting to PHP2.83 billion.

Decliners led advancers at 131 to 56 while 45 stocks were unchanged. (PNA)

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