THE PESO inched down as the decline in oil prices earlier this week continued to affect investor sentiment. — BW FILE PHOTO

THE PESO closed sideways on Wednesday due to weak investor sentiment because of worries over lockdowns amid the coronavirus disease 2019 (COVID-19) outbreak and after a drop in oil prices.

The local unit finished trading at P50.80 per dollar yesterday, depreciating by a centavo from its P50.79 close on Tuesday, according to data from the Bankers Association of the Philippines.

The peso opened the session at P50.85 per dollar. Its weakest showing was at P50.88 while its strongest was at P50.79 against the greenback.

Volume of dollars traded declined to $212.77 million from the $381.9 million logged on Tuesday.

A trader said the peso’s slight weakness came on the back of market jitters on the economic impact of lockdowns due to the pandemic.

“The peso slightly weakened as investors remained broadly cautious over the economic impact of the coronavirus-related lockdowns locally and abroad,” the trader said in an e-mail.

Meanwhile, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort noted the peso’s slight depreciation came after a decline in global stock markets.

“Peso was slightly weaker after healthy downward correction in the US and local stock markets, as the collapse in global oil prices could adversely affect valuation of listed oil companies,” he said in a text message.

Reuters reported that Asian stock markets dropped to two-week lows on Wednesday due to lower crude prices caused by falling demand on the back of COVID-19.

MSCI’s broadest index of Asia-Pacific shares outside Japan slipped by 0.8% while Japan’s Nikkei slumped by 1.2%.

At home, the Philippine Stock Exchange index shed 18.50 points or 0.33% to close at 5,573.75 on Wednesday.

Oil prices found some respite on Wednesday as US oil futures rose more than 20% and Brent prices steadied after a two-day price plunge, as markets struggle with a massive crude glut amid the coronavirus outbreak.

After falling into negative territory for the first time in history amid record trading volumes, US crude futures rose 20% as contracts for May delivery expired and the June contract became the front month.

West Texas Intermediate was up $2.05 or 18% at $13.62 a barrel by 0034 GMT.

Brent crude, which settled down 24% in the previous session, was up 4 cents at $19.37 a barrel after rising more than $1 earlier.

Oil prices have slumped over 70% this year as the coronavirus has slashed demand for everything from jet fuel to gasoline, while storage tanks around the globe are filling rapidly.

For today, the trader gave a forecast range of P50.80 to P51 per dollar, while Mr. Ricafort sees the local unit moving around the 50.70 to P50.90 levels. — LWTN with Reuters

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