Share prices are expected to trade sideways this week as investors continue to monitor developments overseas, especially the looming US-European Union trade war, for guidance.
“Movement (this) week for the PSEi should still be highly likely influenced by US market movement. Support remains at May’s low of 7,475,” said Gabriel Jose Perez, a trader from Papa Securities said.
Local investors, meanwhile, are awaiting how the two initial public offerings, Axelum Resources Corp. and All Home Corp., will perform during their listing this week.
Axelum is scheduled to list its shares on Oct. 7 while those of All Home will make its market debut on Oct. 10.
With inflation slowing down, analysts are expecting investors to turn into bargain hunters on expectations of another interest rate cut from the Bangko Sentral ng Pilipinas before the end of the year.
The government last week reported that the inflation slowed to 0.9 percent in September, or more than three-year low, from 1.7 percent in August.
The Philippine Stock Exchange Index declined 1.5 percent last week to 7,704.60 points, while the broader All Shares Index fell 1.1 percent to 4,675.60.
The index dropped to the 7,500-point level on Thursday before recovering to the 7,700 level on Friday as inflation eased in September.
Except for the financials index which inched up 0.1 percent, all other sub-indices ended in red, led by holding firms (-2.2 percent), services (-2.2 percent), property (-1.4 percent) mining and oil (-1.4 percent) and industrial (0.8 percent).
Foreign investors were net sellers for the week by P5.8 billion, while the average daily value traded stood at P7.57 billion from the previous week’s average of P6.3 billion.
Weekly top price gainers were Alliance Global Group Inc., which rose 3.5 percent to P11.28; SM Prime Holdings Inc., which climbed 3.4 percent to P37.75; and Aboitiz Equity Ventures Inc., which gained 1.8 percent to P54.50.
Weekly top price losers were Ayala Land Inc., which fell 6.3 percent to P46.20; San Miguel Corp., which dropped 6.3 percent to P164; and Ayala Corp., which lost 5.9 percent to P840.
European and US equities enjoyed strong gains Friday following American jobs data that eased recession fears even as investors continued to expect more Federal Reserve interest rate cuts to boost the economy.
The report said the US added 136,000 jobs in September, while the unemployment rate fell to 3.5 percent, a 50-year low. But the pace of job creation slowed and wages fell.
Analysts described the report as a mixed bag.
“The unemployment rate may have dropped to its lowest level in 50 years but the labor market is weakening and not improving,” said BK Asset Management’s Kathy Lien.
“The job market is still the strongest in decades, but there’s no question that it is in the midst of a slowdown.”
The jobs data came on the heels of weak reports on the manufacturing and services sectors that had amplified worries over the US economy. With AFP
