Trump Tariff Pledges Send Peso and Stock Market Tumbling

Title Trump Tariff Pledges Send Peso and Stock Market Tumbling

The latest tariff pledges by US President Donald Trump sent shockwaves around the world, causing the peso to weaken and the Philippine stock market to plummet on Monday.

The currency slipped six and a half centavos to P58.095 against the dollar, while the benchmark Philippine Stock Exchange index (PSEi) fell 117.87 points, or 1.91 percent, to 6,037.12. The broader All Shares dropped 46.37 points, or 1.27 percent, to 3,617.27.

The peso's decline was attributed to the strengthening of the US dollar against major global currencies, according to Rizal Commercial Banking Corp.'s chief economist, Michael Ricafort. Meanwhile, Philstocks Financial Inc.'s research manager, Japhet Tantiangco, noted that the local market closed lower due to Trump's tariff threats, which could negatively impact the global economy.

As the Philippines' largest export market, the US accounts for 16.8 percent of all outbound merchandise shipments as of December last year. The country's top exports include electronics and electrical equipment, machinery, and transport equipment.

Trading on Monday was characterized by caution, with net value turnover at P5.03 billion. Foreigners turned net sellers, contributing to the market's drop, while net outflows reached P438.19 million.

The decline in the stock market was driven by concerns over the potential for the US to impose reciprocal tariffs on other countries, said DragonFi Securities, Inc.'s equity research analyst, Jarrod Tin. Investors are adopting a cautious stance ahead of key economic data releases, including the US inflation report on Wednesday and the Philippine interest rate decision on Thursday.

Regina Capital Development Corp.'s Managing Director, Luis Limlingan, noted that investors awaited the latest MSCI rebalancing results, while others took cues from fresh economic data and possibly more developments on the geopolitical front.

On a sector basis, all indices closed in the red, with property down the most by 2.43 percent. Mining and oil was the sole gainer, up 0.90 percent.

Company-wise, decliners outnumbered gainers, 111 to 78, while 44 were unchanged.

As investors wait for further developments, they may want to consider taking a closer look at the impact of Trump's tariff pledges on the global economy and their investment portfolios.

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Keywords peso, stock market, Trump tariffs, trade war, Philippines, US dollar, Philippine Stock Exchange index (PSEi), All Shares, Rizal Commercial Banking Corp., Philstocks Financial Inc., DragonFi Securities, Inc., Regina Capital Development Corp.

Edward Lance Arellano Lorilla

CEO / Co-Founder

Enjoy the little things in life. For one day, you may look back and realize they were the big things. Many of life's failures are people who did not realize how close they were to success when they gave up.