Philippines

US-China trade pact, Taal eruption hurt peso, stocks

US-China trade pact, Taal eruption hurt peso, stocks
By Joann Villanueva

MANILA (Philippines News Agency) – Risk-off sentiment due to uncertainties of the US-China trade pact and the possible impact of the Taal Volcano eruption to Philippines’ growth and inflation rate weakened both the main equities index and the peso Thursday.

Philippine Stock Exchange index (PSEi) shed further by 0.15 percent, or 11.22 points, to 7,653.18 points.

All Shares declined by 0.18 percent, or 8.30 points, to 4,531.00 points.

Most of the sectoral counters ended the day on the red, led by the Property with 0.67 percent drop. Industrial followed after it fell by 0.50 percent as well as Holding Firms, 0.45 percent; and Services, 0.07 percent.

Financials and Mining and Oil rose by 1.03 percent and 0.99 percent, respectively.

Volume reached 1.04 billion shares amounting to PHP6.44 billion.

Losers surpassed gainers at 112 to 89, while 32 shares were unchanged.

BPI Research also attributed the main index decline to the weaker-than-expected growth of remittances sent by overseas Filipino workers (OFWs) last November.

Data released by the Bangko Sentra ng Pilipinas (BSP) showed that cash remittances grew by 2 percent in the 11th month this year, lower than the 8-percent expansion in the previous month.

End-November 2019 cash remittances grew by 4.4 percent, slower than the 4.6-percent growth in the previous month but better than the 3.1 percent during the same period in 2018.

Meanwhile, the peso ended the day at 50.83 from the previous day’s 50.715.

BPI Research said uncertainties remain even after the signing of the first phase of the US-China trade deal.

Under the agreement, US will slash tariff to 7.5 percent for about USD120 billion worth of Chinese goods while China will increase purchases of US goods by about USD200 billion over two years.

The accord also aims to strengthen the fight against intellectual property (IP) theft, and avoid currency manipulation.

The peso opened the day at 50.63 from day-ago’s 50.68 start.

It traded between 50.888 and 50.62, resulting in an average of 50.76.

Volume totaled to USD1.22 billion, lower than the previous session’s USD1.25 billion.

The currency pair is seen to trade between 50.70 and 50.95 on Friday. (PNA)

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