For Equities, A shortened week saw the market seek out a small gain of 14 pts (+0.18%) with foreigners selling a total of $6.3m (Php 327m). Meanwhile in Fixed Income, Local bond yields dropped, shadowing US Treasuries’ movement despite higher than expected May CPI data. US Treasury (UST) yields displayed volatility during the week. USTs started with a sharp rally as markets reacted to Fed member Bullard’s dovish statement that a rate cut may be warranted to boost inflation and provide some insurance against global risks including uncertainties on the US-China trade war.

For Equities, The index ended the week on a positive note after muted selling from the MSCI rebalancing. Meanwhile in Fixed Income, Market players continued to reposition ahead of the RR cut implementation pushing 10 –yr. bond yields to its lowest since February 2018. A Risk-off sentiment dominated global markets this week. This was driven by the US- China trade war as well as the resignation of UK Prime Minister Theresa May creating uncertainty in Brexit.

For Equities, Market experienced a recovery during the week as the PSEi advanced 2.15% (163.27 pts) to close at 7,747.09 with an average daily value turnover of $121m (Php 6.3Bn). Meanwhile in Fixed Income, The BSP announced a similar cut in the Reserve Requirement Ratio (RRR) for small banks by 2%, following the same schedule imposed on universal banks. At the week’s close, the UST yield curve bull flattened, with the 2-, 5- , 10- and 30-yr declining 4bps, 6bps, 7bps and 7bps, respectively.