The Weekly Review

Local equities declined on renewed inflationary concerns amid a surge in oil prices due to escalating tensions in the Middle East.

Top performers were DigiPlus Interactive Corp. (PSE Ticker: PLUS; +12.67%), San Miguel Corp. (SMC; +5.81%), and Semirara Mining and Power Corp. (SCC; +0.18%). Meanwhile, Universal Robina Corp. (PSE Ticker: URC; -10.38%), GT Capital Holdings, Inc. (GTCAP; -12.24%), and JG Summit Holdings, Inc. (JGS; -12.67%) were the laggards of the week. 

▼ The PSEi closed at 6,320.41 (-4.40% WoW). 

Local fixed income yields climbed after local inflation accelerated to 2.4% in February (January: 2.0%) on higher food and utilities prices. This was also after Bangko Sentral ng Pilipinas (BSP) Governor Remolona said the central bank may tighten policy if oil prices rise to $100 a barrel.

▲ On average, yields rose by 22 bps, with the 2Y closing at 5.43% (+28 bps) and the 10Y closing at 6.32% (+39 bps).

The Philippine peso weakened as the conflict in the Middle East continued to unfold, leading to a surge in oil prices coupled with safe-haven flows to the US dollar. 

▲ The USD/PHP pair closed at 59.00 (+2.32% WoW).

US equities declined after US and Israel launched a massive attack on Iran, causing oil prices to spike. Investors also digested the February US jobs report which showed nonfarm payroll losses of 92,000 (Consensus: 55,000; Revised January: 126,000) and an uptick in the unemployment rate to 4.4% (Consensus and January: 4.3%).

▼ S&P 500 closed at 6,740.02 (-2.02% WoW).

▼ DJIA closed at 47,501.55 (-3.01% WoW). 

US Treasury yields soared as investors weighed the implications of a prolonged Iran war which drove a sharp increase in oil prices, stoking inflation fears.

▲ On average, yields rose by 13 bps, with the 2Y closing at 3.57% (+18 bps) and the 10Y closing at 4.14% (+20 bps).

The US dollar strengthened, driven by safe-haven demand amid heightened tensions between the US and Iran.

▲ The DXY closed at 98.99 (+1.41% WoW). 

Sources: BusinessWorld, Inquirer, Philippine Star, Manila Bulletin, Businessmirror, PSE Edge, Bloomberg, CNBC, Reuters, CNN, Wall Street Journal, Financial Times, Market Watch

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