Stocks, peso weaken after poor US jobs report

By Krista Angela M. Montealegre, Reporter
Tuesday, June 07, 2011

PHILIPPINE share prices on Monday tumbled for the second consecutive session as the weak US jobs data and expectations of rising inflation weighed on investor sentiment.
At the Philippine Stock Exchange, the composite index fell 38.72 points, or 0.90 percent to 4,258.90, while the broader all-shares index lost 23.01 points, or 0.76 percent to 2,997.58.

Losers beat gainers, 80 to 51, while 47 issues were unchanged. A total of 2.68 billion stocks worth P2.93 billion changed hands.
“With US jobs data disappointing last Friday, the downward pressure was too much for the local stock market to resist,” said Prince Anthony Yeung of AB Capital Securities Inc.

“With very little to hinge trading decisions on, investors’ focus remained on the poor economic numbers from the US last week, particularly the evident weakness in the jobs sector,” said Jun Calaycay of Accord Capital Securities Inc.

A slowdown in US employment added proof that the recovery in the world’s biggest economy is weakening, sending Asian markets lower. On Friday, the Dow Jones Industrial Average lost 97.29 points, or 0.80 percent to 12,151.26.
Expectations of higher consumer prices in May also weighed on investor sentiment, triggering another sell off.

“The prospect of inflation topping the government’s 3-percent to 5-percent target range heightened the possibility of a third interest rate hike when the Monetary Boards sits for the fourth time this year,” said Calaycay.

The PSEi may once again try its support near 4,200, depending on the actual inflation numbers, which will be released Tuesday, and how the market will see interest rates moving forward to next week’s Bangko Sentral ng Pilipinas meeting, he added.
Asian currencies were mostly down in holiday-thinned trade Monday also because of the latest US jobs data.

At the Philippine Dealing System, the peso moved sideways to close at 43.21, or 5 centavos weaker than 43.205 last week.

The dollar-peso pair opened at 43.12 and moved to a high of 43.21 and a low of 43.12.
Total trading volume eased to $483.01 million from last week’s $665.84 million.
Traders expect the dollar-peso exchange to trade at 42.80 to 43.50 range within the week.

Source: http://www.manilatimes.net/business/stocks-peso-weaken-after-poor-us-jobs-report/