Risk-off sentiments reigned in the local bourse on Monday ahead of the Federal Reserve meeting later in the week, resulting in the negative close of the main index but the peso gained against the United States dollar.

The Philippine Stock Exchange index (PSEi) shed 0.51 percent, or 34.9 points, to 6,744.12 points.

All Shares followed with a decline of 0.38 percent, or 13.94 points, to 3,607.75 points.

All the sectoral counters also finished the day in the negative territory, led by Mining and Oil after it slipped by 1.21 percent.

It was trailed by Industrial, 0.68 percent; Property, 0.49 percent; Holding Firms, 0.43 percent; Financials, 0.39 percent; and Services, 0.15 percent.

Volume totaled 483.44 million shares amounting to PHP3.3 billion.

Decliners led advancers at 115 to 72 while 47 shares were unchanged.

Aside from the wait-and-see stance on the rate decision of the Federal Reserve on Feb. 23, Luis Limlingan, Regina Capital Development Corporation (RCDC) head of sales, said investors are also concerned about US’ consumer price index (CPI).

“Market participants are overall still wary of Fed’s rate adjustments to tame inflation,” he said.

On the other hand, Brent crude oil futures declined to USD83 per barrel and the West Texas Intermediate (WTI) to USD76.34 per barrel.

Meanwhile, the peso gained against the US dollar and closed the week’s first trading day at 54.95 from 55.24 last Friday.

It opened the day at 55.31, sideways from the 55.25 start in the previous session.

The local currency traded between 55.32 and 54.95, resulting in an average of 55.168.

Volume reached USD717.4 million, lower than the USD878.3 million at the end of last week.

Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said concerns on US’ inflation rate, the Federal Reserve rate decision and correction of the peso factored in during the day’s foreign currency market trading.

Ricafort said market participants are factoring in the 0.25 basis points increase in the Federal Reserve rates during the next two meetings of the Federal Open Market Committee (FOMC).

“The peso is also stronger vs. the US dollar after global crude oil price eased to near two-week lows recently, also among the lowest in more than a year,” he said.

For Tuesday, the currency pair is expected to trade between 54.85 to 55.10 against the US dollar.

CURRENTPH NEWS SERVICE