Peso rises on stock market gains

THE PESO strengthened versus the dollar on Tuesday on continued gains at the local stock market.

The local unit closed at P54.77 per dollar on Tuesday, inching up by a centavo from its P54.78 finish on Monday, Bankers Association of the Philippines data showed.

The peso opened Tuesday’s session P54.83 versus the dollar. Its lowest showing for the day was at P54.88, while its intraday best was at P54.64 against the greenback.

Dollars exchanged rose to $1.65 billion on Tuesday from $1.17 billion on Monday.

“The peso exchange rate continued to strengthen for the second straight day… as this would be more advantageous for some foreign investors converting their US dollars and receive more peso proceeds used for any bargain-hunting/bottom fishing activities and other purchases in the local financial markets,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“Peso also stronger after the PSEi gained for the third straight trading day, as the relief rally since Friday continued… after US stock markets still hovered among two-week highs recently after the net gains/relief rally since late last week, as global crude oil prices lingered among one-month lows and the 10-year US Treasury yield hovered among two-week lows recently,” Mr. Ricafort said.

Philippine stocks closed higher on Tuesday on continued bargain hunting after last week’s decline and amid window-dressing activities.

The benchmark Philippine Stock Exchange index rose by 106.59 points or 1.70% to close at 6,345.41 on Tuesday and the broader all shares index climbed by 48.21 points or 1.43% to 3,400.68.

Wall Street rebounded on Friday as oil prices eased, tempering fears of a recession in the US due to aggressive Federal Reserve tightening amid higher inflation.

Meanwhile, oil prices swung higher after China eased quarantine rules, with focus already on tight supply as G7 leaders agreed to study placing price caps on imports of Russian oil and gas, Reuters reported.

US crude rose 1.41% to $111.08 a barrel. Brent crude jumped 1.3% to $116.59 per barrel.

For Wednesday, Mr. Ricafort said the peso could move from P54.65 to P54.85 per dollar. — KBT with Reuters