Oliver Bugarin 0 0 0 4 min to read

Peso drops to a fresh record low of 57.13; PSEi mirrors the decline on Wall Street.

On Wednesday, worries about the impact of the Federal Reserve’s tightening efforts affected the local stock market, causing the major index to close lower and the peso to drop even more.

To reach 6,554.08 points, the Philippine Stock Exchange index (PSEi) fell 2.32 percent or 155.52 points.

The next stock to trade was All Shares, which dropped 1.71 percent, or 60.88 points, to 3,490.07 points.

Among the sectors indices, Holding Firms experienced the largest decline, falling 3.18 percent.

Financials trailed it with 2.38%, followed by Mining and Oil at 2.29%, Property at 1.72%, Services at 1.46%, and Industrial at 0.958%.

916.47 million shares, or PHP4.85 billion, were traded.

At 115 to 59, decliners outnumbered advancers while 50 shares remained the same.

The head of sales for Regina Capital Development Corporation (RCDC), Luis Limlingan, reported that local shares fell on Tuesday when regular trading resumed in the US after the Labor Day holiday.

As a result of investors seeking “to build a narrative on how tight the Fed’s (Federal Reserve) tightening campaign would be given the robust economic statistics and skyrocketing bond yield,” Wall Street plummeted on Tuesday night, which Limlingan attributed to this.

He said that the 30-year paper posted its highest rate since 2014 at 3.493 percent and that the 10-year Treasury yield for the US reached its highest level since last June at 3.347 percent.

Investors will also be watching the speeches of numerous Fed Presidents, as well as the description of the US economy’s current state that will be revealed later in the day and based on the Fed’s Beige Book, he noted.

Oil prices dropped after a two-day gain, according to Limlingan, after OPEC+ announced its first output target cut since 2020.

According to him, the price of Brent crude oil fell by 3% to USD92.83 per barrel.

In the meantime, the local currency hit a new record low against the US dollar, falling from 57 on Tuesday to 57.135.

It depreciated from its opening price of 56.888 the previous session to 57.00 to start the current session.

It fluctuated between 57.33 and 57.00, averaging out to 57.216.

Volume increased to USD1.23 billion from USD812.19 million the day before.


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