Share prices are expected to re-test the 8,000-point level during this shortened trading week on positive sentiments in the inflation and interest rates. Financial markets will be closed on June 5 in observance of Eid’l Fitr (Feast of Ramadan).
“With the week ending on a high note, next resistance to now look to should be early May’s high of 8,077 which is only just a couple of points away,” Jose Gabriel Perez, a trader from Papa Securities, said.
The Bangko Sentral ng Pilipinas’ Department of Economic Research last week projected the May inflation rate to settle within the 2.8-percent to 3.6-percent range.
The benign inflation rate is boosting market expectations of another rate cut late this year.
“The PSEi could either range-trade from its current state, or move closer to 8,200 depending on macro catalysts that would support investors’ renewed zest,” online brokerage firm 2TradeAsia.com said.
“The financial system remains awash with cash and investors are likely to go hunting for bargain hunters with commendable upside,” it added.
The Philippine Stock Exchange Index last week advanced 2.9 percent to 7,970.02 after a four-day winning streak, while the broader All Shares Inc. climbed 2.3 percent to 4,890.37. The market year-to-date is up 6.8 percent.
All sub-indices ended in the green led by industrial (+3.73 percent), property (+3.68 percent), holding firms (+2.74 percent and mining and oil (+2.66 percent). Services also rose 1.6 percent, while financials ended higher by 1.3 percent.
Foreign investors were net sellers for the week by P200 million, while the average daily value stood at P8.9 billion from the previous week’s P7 billion.
Foreign investors are still net buyers by P28 billion as of the end of May this year.
Weekly top price gainers were PXP Energy Corp., which surged 20.4 percent to P9.25; Universal Robina Corp., which climbed 8.5 percent to P167; and Megaworld Corp., which advanced 8.46 percent to P5.90.
Weekly top price losers were iPeople Inc., which declined 9.6 percent to P10.16; Megawide Construction Corp., which fell 6.05 percent to P20.20; and Ginebra San Miguel Inc., which slipped 3.4 percent to P43.
Meanwhile, global stocks tumbled Friday, with investors fleeing equities for safe-haven assets following the latest salvos on international trade.
With US President Donald Trump announcing new tariffs on all Mexican imports and China warning it would create a list of “unreliable” foreign companies, investors piled into low-risk assets, sending the yield on 10-year German government bonds to a record low.
German Bunds hit minus 0.213 percent in the secondary market, breaking the previous record of minus 0.205 percent set in July 2016, while the 10-year US Treasury note fell further, stoking additional investor angst.
The yen, another safe-haven investment, shot higher, pressuring Tokyo’s main stocks index, which plunged 1.6 percent.
As trade tensions escalated, US indices shed more than one percent in a bitter conclusion to a bruising May, the first month of 2019 with losses. With AFP