Analysts expect the stock market to continue moving sideways this week as investors look overseas for guidance ahead of the release of third-quarter earnings results.
Papa Securities trader Gabriel Jose Perez said the performance of the US markets would continue to influence the movement of local equities market this week.
US markets have been volatile over the past trading weeks due to lingering concerns on the trade war between the US and China and hawkish remarks from the minutes of the US Federal Reserve Board.
But with third quarter earnings results expected to start to trickle in, investors are expected to start taking positions on stocks that will likely report strong earrings in the third and fourth quarters of the year.
“Chartwise, the week’s close at 7,151.52 highlights some room for some upticks towards the 7,300 levels in the near-term. However, failure to clear or test 7,300 levels the could signal a retest of the 6900/7000 levels,” BDO Unibank Inc. chief investment strategist Jonathan Ravelas said.
The Philippine Stock Exchange Index last week rose 2.1 precent to 7,151.15 while the broader All Shares Index added 1.34 percent to 4,359.65
Except for services index which dipped 0.03 percent, all sectoral indices ended higher, led by mining and oil (+9.6 percent), financials (+4.04 percent), property (+2.62 percent), industrials (+2.19 percent), and holding firms (+1.04 percent).
Foreign investors were net sellers by P1.9 billion while the average daily value traded stood at P4.76 billion.
Weekly top price gainers were Nickel Asia Corp., which gained 14.4 percent to P2.74; Semirara Minining and Power Corp., which climbed 13.4 percent to P29.50; and ISM Communications Corp., which it set to become the listed holding company of businessman Dennis Uy, which advanced 9.9 percent to P3.21.
Weekly top losers, meanwhile, were San Miguel Food and Beverage Inc., which declined 5.9 percent after the company reduced the size of its share sale; San Miguel Corp., fell 5.4 percent to P158; and Robinsons Retail Holdings Inc., which declined 4.4 percent to P76.50.
Meanwhile, an early rally on Wall Street fizzled Friday as global bourses finished mixed amid a range of worries that included Italy’s messy budget dispute with Brussels and slowing Chinese growth.
US stocks opened strongly following good earnings reports from Procter & Gamble, American Express and others, but the market lost steam at midday. All three major indices had slumped more than one percent on Thursday.
“In a week when developments seem more mixed than bearish, markets are struggling to stabilize from an early-October shock that began in Bonds and ended in Equities,” JPMorgan Chase said in a research note.
The analysts said earnings would be a positive catalyst for stocks over the next two or three weeks, but warned of a medium-term hit after the period of “peak” earnings growth ends.
The Nasdaq was the worst performing of the three major indices, ending down 0.5 percent at 7,449.03, following a session in which it swung more than 150 points.
The S&P 500 finished with a small loss, while the Dow edged higher.