Share prices are expected to continue to trade sideways during this shortened trading week as investors weigh the prospects of the Philippine economy amid the negative developments overseas.
Analysts said the rising tension and concerns over the trade war between the US and China would make trading in the equity markets volatile.
BDO Unibank Inc chief investment strategist Jonathan Ravelas said the bellwether Philippine Stock Exchange Index could weaken toward the 7,500-7,800 point level over the the near-term period.
Investors are also concerned about rising consumer prices, which have been pushing inflation rate over the past couple of months and could lead to higher interest rates, weakening the country’s economic growth prospects.
The Philippine Statistics Authority last week reported that inflation rate in March rose to 4.3 percent, exceeding the government’s target range of 2 percent to 4 percent for the year, driven mainly by faster increases in the prices of the so-called sin products.
The Bangko Sentral ng Pilipinas, however, said its expects inflation to average 3.9 percent this year, before easing to 3 percent in 2019.
The Philippine Stock Exchange Index last week closed below 8,000 points, dropping 0.4 percent to end at 7,945.66, while the All Shares Index dipped 0.2 percent to 4,828.50.
Except for mining and oil and holding firms, which climbed 3.86 percent and 1.89 percent respectively, all other sub-indices ended in the negative.
Foreign investors were net sellers by P1.5 billion, while average daily value traded stood at P6.2 billion.
The weekly top price gainers were San Miguel Food and Beverage Inc., which advanced 14.7 percent to P69.20; Travellers International Hotel Group Inc., which rose 12.9 percent to P4.70; and SM Investments Corp., which gained 6.3 percent to P976.
The weekly top price losers were Jollibee Foods Corp., which decreased 7 percent to P278; Universal Robina Corp., which declined 5.9 percent to P143; ABS-CBN Corp., which fell 5.6 percent to P28.70; and Bank of the Philippine Islands, which lost 4.9 percent to P108.
US stocks, meanwhile, plunged more than two percent Friday after President Donald Trump warned of tariffs on an additional $100 billion of Chinese imports, provoking a strong response from Beijing and fanning fears of a full-blown trade war.
Investors were unnerved by the latest broadside from the volatile US president and by China’s strident response, which vowed Beijing would stand firm “until the end at any cost.”
The Dow finished down 2.3 percent at 23,932.76, with all 30 members ending in the red. The S&P 500 and tech-rich Nasdaq indices also lost more than two percent.
The barbs over trade overshadowed a lackluster jobs report, which placed US jobs growth at 103,000 in March, well below analyst expectations. Unemployment held steady at 4.1 percent.
European equity markets also retreated, but not as severely, with Paris, Frankfurt and London falling half a percentage point or less. With AFP
