THE peso edged lower and the stock market fell by nearly 1 percent as financial markets reopened on Thursday following a two-day holiday break.

The currency closed at P56.5 against the dollar from P56.491 previously while the benchmark Philippine Stock Exchange index (PSEi) shed 63.42 points, or 0.94 percent, to end the day at 6,677.65.

The broader All Shares index likewise fell, by 0.95 percent or 33.72 points, to 3,525.87.

The peso opened at P56.53:$1 and ranged from P56.42 to P56.58. Volume reached P1.312 billion, up from P1.22 billion in the previous session.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., said the slight weakening came as the dollar had risen against major global currencies following faster-than-expected US inflation.

Philstocks Financial Inc. researcher Mikhail Plopenio, meanwhile, said the PSEi dropped as investors had taken negative cues from the "hawkish pause of the Bangko Sentral ng Pilipinas" during a policy meeting last Monday.

Growing inflationary risks at home have temper expectations of possible interest rate cuts by the BSP this year, he added.

"[N]egative spillovers from Wall Street, driven by the higher-than-expected US inflation for March, clouded investors' sentiment," Plopenio continued.

Market participation was strong, resulting in a net value turnover of P5.81 billion — higher than the year-to-date average of P5.04 billion.

Foreigners were net sellers, recording a net outflow of P222.56 million.

Financials led the gainers with a 1.1-percent increase. The property index, on the other hand, dropped the most by 3.54 percent.

Decliners overwhelmed advancers, 134 to 57, while 50 were unchanged.