Trading at the Philippine Stock Exchange is expected to move sideways this week as investors take some cues in the upcoming US Federal Open Market Committee meeting scheduled this week.
Analysts said the upcoming US FOMC meeting could also provide investors an indication if global rate hikes would continue or taper off next year.
At the same time, the recent move of the Bangko Sentral ng Pilipinas to keep rates unchanged should calm investors and is an indication that inflation is stabilizing.
“So far, the PSEi’s upwards trajectory has managed to stay intact as we continue to stay above immediate support; we’re still on our way to test resistance at 7,617 as long as we don’t see a breach below 7,330,” Arbee Lu, head of online trading of Papa Securities, said.
“We continue to monitor the VIX fear gauge (volatility measure based on S&P 500 options) as well, a good indicator of investor sentiment. We’ve seen the VIX declining throughout the week in response to positive trade war developments. If this continues to improve, we may be able to look forward to a yearend rally,” Lu added.
The PSEi last week closed gained 0.8 percent to 7,524.37, while the the broader All Shares index added 0.2 percent to 4,506.50.
Major counters, however, ended mixed with the industrial, holding firms and services indices posting week-on-week gains, while the financial, mining and oil and property sectors registered week-on-week declines.
Foreign investors were net buyers by P2.28 billion, while the average daily value traded improved to P8.8 billion from the previous week’s average of P8.7 billion.
Weekly top price gainers were Bloomberry Resorts Corp., which climbed 17.1 percent to P9.39; Aboitiz Equity Ventures Inc., which rose 11.3 percent to P56; and JG Summit Holdings Inc., which advanced 6.2 percent to P53.20.
Weekly top price losers, meanwhile, were San Miguel Corp., which declined 12.4 percent to P142; PAL Holdings Inc., which dropped 11.2 percent to P7.58; and SM Prime Holdings Inc., which lost 3.9 percent to P34.60.
Wall Street led stock markets lower across the globe on Friday after data showed weakness in the Chinese and eurozone economies, despite further indications Beijing and Washington might be moving to end their trade war.
Signs of easing tensions had helped propel equities higher earlier last week week, with both China and the United States seeming to give key concessions, fueling hopes they can eventually resolve their differences.
But data showing that the trade war is already having an impact on China—consumer spending grew at its slowest pace in 15 years and factories eased up in November—prompted equities investors there to take their gains off the table.
Rosier US retail and industrial data could not assuage fears that growth and the trade spat with Beijing will drag on sentiment.
In New York, a sell-off extended recent losses and drove all three major indices into correction—a 10 percent fall from recent peaks in October. With AFP
