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First decline in PSEi since 2023 due to profit-taking, rising peso

On Friday, the Philippine Stock Exchange index’s (PSEi) three-day winning streak was broken by profit-taking, but the peso rose versus the US dollar.

The primary stock market index fell 93.36 points, or 1.38 percent, to 6,667.97 points.

With a loss of 1.05 percent or 37.38 points, All Shares lagged behind by 3,513.07 points.

All the sector’s indicators likewise finished the week lower, with Industrial leading the way with a 1.84 percent decline.

Following it was Holding Companies (1.38%), Mining and Oil (1.22%), Services (1.20%), Property (1.11%), and Financials (0.63%).

7.15 billion shares, or PHP5.5 billion, were traded.

At 124 to 69, decliners outnumbered advancers while 41 shares remained the same.

According to Luis Limlingan, head of sales for Regina Capital Development Corporation (RCDC), “Philippine shares finally saw the first profit-taking session of the year on the basis of good US (United States) jobs data announced last night, stoking predictions for higher rate hikes ahead.”

ADP’s private payrolls report for December 2022 revealed a higher-than-anticipated growth in employment of 235,000 jobs.

The December 2022 non-farm payrolls report, which will be released by the US Labor Department later in the day, is anticipated to climb by 200,000, down from 263,000 in the preceding month, according to Limlingan.

He stated that “a better-than-expected report indicating a strong labor market could suggest the Fed (Federal Reserve) has further to go in its attempts to contain inflation.”

Brent crude futures increased by 1.7 percent to USD 79.15 per barrel, while West Texas Intermediate (WTI) futures increased by 1.8 percent to USD 74.13 per barrel, “helped by data showing decreasing gasoline stockpiles in the US.”

On the other hand, the local currency strengthened in relation to the US dollar after finishing the week at 55.64 as opposed to 55.75 the day before.

It moved between 55.57 and 55.89 throughout the day’s sideways opening at 55.85. For the day, the average level was 55.681.

Volume decreased from the previous session’s USD 1.06 billion to USD1.05 billion.

Michael Ricafort, chief economist of Rizal Commercial Banking Corporation (RCBC), claimed that a correction caused the peso to close on December 23 at 55.15, its lowest level in the previous two weeks.

He said that the local unit corrected lower by 0.2 percent in the first trading week of the year, attributing this in part to the net gains of the PSEi, which finished the first trading week of the year down owing to profit-taking.

According to Ricafort, the peso’s subsequent crucial support level is at 55.00 to the US dollar.

The range for Monday is predicted to be between 55.55 and 55.75, and he expects the currency pair to trade between 55.40 and 55.90 next week.

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