The stock market is expected to sustain a sideways movement with a downward bias this week, on the weakening of the peso against the US dollar and lingering concerns over the US interest rate increase next month.
Traders said the peso depreciation to 50 per dollar could affect investors’ sentiments in the four-day trading week.
The market will be closed Wednesday in observance of Bonifacio Day.
“With only four trading sessions this week, downside pressures might still be seen and could take its queue from the peso-dollar trend. More than the anticipated Fed rate hike, domestic political noises might add to players’ watch list unless fresh catalysts emerge,” online brokerage firm 2TradeAsia.com said.
“Stay alert for accumulation on lows. Immediate support is 6,750 to 6,800, resistance at 6,950 to 7,000,” it said.
Analysts said investors would also monitor the Nov. 30 meeting of the Organization of the Petroleum Exporting Countries to discuss the implementation of a proposed cap on crude production.
The bellwether Philippine Stock Exchange index declined 2.5 percent last week to 6,889.78 Friday, while the all-share index dropped 1.8 percent to 4,176.54.
The market index was down 0.9 percent since the start of the year.
Except for mining and oil which gained 7.3 percent last week week on improving metal prices and strengthening dollar against the peso, all other major indices were in the red.
The financials index decreased 3.1 percent followed by property which dropped 2.9 percent and services which lost 2.1 percent.
Foreign investors were net sellers by P3.8 billion last week, with the average daily value turnover dropping to P6.06 billion from the previous week’s average of P7.13 billion.
Top gainers last week were PhilWeb Corp., which surged 58 percent to P14.74 and Atlas Consolidated Mining and Development Corp. which increased 10 percent to P5.30.
Heavy losers were Security Bank which dipped 9.1 percent to P188.10, Ayala Corp. which dropped 6.6 percent to P728 and Manila Electric Co. which declined 6.3 percent to P266.