The Weekly Review

Local equities dropped as lingering trade uncertainties dampened market sentiment, with investors expressing concerns on the US’ 20% tariff on Philippine exports. 

Top performers were Emperador Inc. (PSE Ticker: EMI; +3.18%), PLDT Inc. (TEL; +2.12%), and Puregold Price Club Inc. (PGOLD; +1.53%). Meanwhile, Bloomberry Resorts Corp. (PSE Ticker: BLOOM; -6.32%), Alliance Global Group Inc. (AGI; -7.37%), and SM Investments Corp. (SM; -7.87%) were the laggards of the week.

▼ The PSEi closed at 6,303.72 (-2.42% WoW). 

Local fixed income rose as the faster-than-expected consumer price index (CPI) inflation and retail sales data in the US tempered expectations of Fed rate cuts. This was also after the Bureau of the Treasury’s Php25 billion reissued 10Y bonds.

▲ On average, yields rose by 2 bps, with the 2Y closing at 5.75% (+1 bp) and the 10Y closing at 6.27% (+3 bps).

The Philippine peso weakened as global trade uncertainties continued following Trump's renewed tariff threats on the EU and Mexico. Moreover, the hotter-than-expected US June CPI inflation print pushed back expectations of Fed rate cuts this year.​

▲ The USD/PHP pair closed at 57.15 (+1.20% WoW).

US equities closed mixed as investors digested varied earnings from major financial companies as well as upbeat results of PepsiCo and Taiwan Semiconductor. Moreover, market sentiment was dampened by reports of a proposed minimum 15%-20% European Union tariffs.

▲ S&P 500 closed at 6,296.79 (+0.59% WoW).

▼ DJIA closed at 44,342.19 (-0.07% WoW).

US Treasury yields ended mixed after the US CPI inflation rose more than expected to 2.7% YoY in June (May: 2.4%; consensus: 2.6%), which raised fears that US tariffs are starting to impact consumer prices. Investors also weighed Trump's remarks denying claims that he would soon fire Fed Chair Powell.​

➖ On average, yields were flat, with the 2Y closing at 3.87% (-2 bps) and the 10Y closing at 4.42% (+1 bp).

The US dollar strengthened as the above-consensus US CPI print in June, below-consensus weekly jobless claims, and robust retail sales in May, supported expectations that the Federal Reserve may delay rate cuts.

▲ The DXY closed at 98.48 (+0.64% 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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