PHILIPPINE STOCKS slumped for the second straight day on Tuesday as investor sentiment turned negative due to a weaker peso and expectations that the government’s outstanding debt will continue to increase.

The Philippine Stock Exchange index (PSEi) fell by 0.64% or 42.87 points to end at 6,606.36 on Tuesday, while the broader all shares index dropped by 0.48% or 17.56 points to close at 3,587.77.

“The local market dropped as investors worry over the local currency, which has been showing signs of weakening against the dollar,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message.

The peso closed at P58.645 per dollar on Tuesday, down by 13.4 centavos from its P58.511 finish on Monday, based on data from the Bankers Association of the Philippines. This marked its weakest close in almost a month or since its P58.725-per-dollar finish on July 3.

“The Department of Budget and Management’s projection that the national debt will increase by 8.08% year on year to P17.35 trillion by end-2025 weighed on sentiment,” Mr. Plopenio added.

The bulk of the projected end-2025 total will come from outstanding domestic debt, which is seen to increase by 9.64% to P11.98 trillion from P10.92 trillion by end-2024.

Outstanding external debt is also forecasted to climb by 4.76% to P5.38 trillion by end-2025 from P5.13 trillion by end-2024.

“Philippines shares closed near the 6,600 mark following the mixed session of the United States as fund managers continue to sell before the closing of the month, which saw July rise substantially,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

“The Fed’s two-day meeting begins Tuesday, where Fed Chief Jerome H. Powell may signal upcoming rate cuts. Investors are awaiting the Fed meeting, which could influence the Bangko Sentral ng Pilipinas’ rate decision,” he added.

Majority of sectoral indices closed lower on Tuesday. Financials dropped by 1.61% or 32.65 points to 1,988.72; property declined by 1.28% or 33.94 points to 2,606.62; mining and oil retreated by 0.81% or 67.41 points to 8,185.86; and holding firms went down by 0.65% or 37.67 points to 5,754.57.

Meanwhile, services rose by 0.54% or 10.92 points to 2,001.15, and industrials went up by 0.05% or 4.64 points to 9,179.14.

“Among the index members, Alliance Global Group, Inc. was at the top, climbing 3.13% to P8.90. Ayala Land, Inc. lost the most, dropping 2.91% to P30.05,” Mr. Plopenio said.

Value turnover fell to P4.63 billion on Tuesday with 739.53 million shares changing hands from the P5.06 billion with 658.32 million issues traded on Monday.

Decliners outnumbered advancers, 118 versus 74, while 43 names were unchanged.

Net foreign selling rose to P607.78 million on Tuesday from P500.34 million on Monday. — Revin Mikhael D. Ochave

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