The Weekly Review

Weekly review as of July 10, 2023.

Key events that transpired during the week

• The Philippine Statistics Authority reported that inflation cooled further to 5.4% in June from 6.1% in May. This brought year-to-date inflation to 7.2%. The slowdown in inflation can be attributed to cooling food and transportation price inflation.
  
  
• Top performers were Globe Telecom Inc (PSE Ticker: GLO; +4.56%), Metro Pacific Investments Corp (MPI; +3.98%), and Wilcon Depot Inc (WLCON; +3.11%). Meanwhile, Ayala Corp (PSE Ticker: AC; -3.20%), ACEN Corp (ACEN; -3.53%), and Aboitiz Power Corp (AP; -7.41%) were the laggards of the week.

Local Indices

• Local equities fell on profit taking as resilient US jobs data which increased concerns over the US Fed's next policy moves weakened investor sentiment. Investors also digested slower June local inflation and manufacturing PMI data. The PSEi closed at 6,379.03 (-1.38% WoW).
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• Local fixed income yields continued to rise despite cooling domestic inflation data as major central banks such as the Federal Reserve and European Central Bank remain hawkish. On average, yields rose by 18.47 bps, with the 2Y closing at 6.39% (+7.00 bps) and the 10Y closing at 6.69% (+38.42 bps).
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• The Philippine Peso weakened as investors digested the Fed's hawkish tone in its latest minutes of the meeting. The USD/PHP pair closed at 55.62 (+0.76% WoW).

US Indices

• US equities declined as the latest Fed meeting minutes and a strong batch of labor data fueled rate hike fears. The S&P 500 closed at 4,398.95 (-1.16% WoW) and the DJIA closed at 33,734.88 (-1.96% WoW).
  
  
• US treasury yields rose significantly as investors digested the strong labor market data and the release of Fed's latest meeting minutes. On average, yields rose by 14.91 bps WoW with the 10Y closing at 4.07% (+23.10 bps).
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• The US Dollar weakened as investors weighed the weaker-than-expected US nonfarm payrolls data. The DXY closed at 102.27 (-0.62% DoD).

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Sources: BPI, Business World, PDI, Phil Star, Manila Bulletin, Reuters, Briefing, Bloomberg, CNN, Dow Jones, The Wall Street Journal, CNBC

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