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The major index of the local bourse closed down on Monday as investors adopted a wait-and-see attitude about the Federal Reserve’s rate decision later in the week, while the peso ended the day in a sideways pattern against the US dollar.

To reach 6,970.97 points, the Philippine Stock Exchange index (PSEi) lost 1.15 percent or 81.19 points.

The All Shares index fell next, by 1.02 percent, or 37.67 points, to 3,659.96.

The majority of the sectoral counters lagged the main index, with the Mining and Oil sector leading the pack after it plummeted by 3.25 percent.

Property, 2.21 percent, Industrial, 1.53 percent, Services, 1.35 percent, and Holding Firms, 1.08 percent came in second and third, respectively.

After a climb of 0.51 percent, the only index to advance during the day was the Financials index.

1.21 billion shares, or PHP8.3 billion, were traded.

At 147 to 57, decliners outnumbered gainers while 38 shares remained the same.

According to Luis Limlingan, head of sales at Regina Capital Development Corporation, “Philippine shares started the week in the red with attention primarily on the Fed (Federal Reserve) interest rate decision out this week.”

Beginning on January 31, the Federal Open Market Committee will convene for two days.

Many people are still trying to make sense of the Fed members’ recent discussions on the path of interest rates given the trend of inflation in recent months, according to Limlingan.

Given the continued decline in the US consumer price index, it is largely expected that the Fed would announce a rate increase of less than 75 basis points.

Oil prices dropped “as signs of a robust Russian oil supply countered better-than-expected US economic growth figures, good middle distillate refining margins, and hopes of a swift recovery in Chinese demand,” according to the report.

According to Limlingan, the West Texas Intermediate crude futures fell by 1.6 percent to USD79.68 per barrel and the Brent crude futures fell by 0.9 percent to USD86.66 per barrel.

The local currency, which had started the day at 54.47 against the US dollar, concluded the day at 54.545.

It started the day at 54.55, which was lower than its 54.4 starts from the week’s finish.

It fluctuated between 54.6 and 54.45, averaging 54.545.

Volume decreased from USD 946.65 million in the previous session to USD 687.86 million.

Michael Ricafort, the chief economist of Rizal Commercial Banking Corporation, claimed that the local unit’s correction was somewhat caused by the PSEi’s same outcome.

According to him, investors are also anticipating the Federal Reserve’s rate announcement, which is projected to raise benchmark interest rates by 25 basis points.

The latest week-over-week downward correction in Treasury bill auction results was particularly notable, he added. “Market sentiment also supported recently by more dovish signals by the Fed and local monetary authorities that led to some downward correction in various government and BSP (Bangko Sentral ng Pilipinas) securities auction yields.”

The expected trading range for the currency pair on Tuesday is 54.45 to 54.65.

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