Trading at the Philippine Stock Exchange is expected to return to consolidation after last week’s strong rally as investors are expected to cash in on recent gains.
ChinaBank Capital managing director Juan Paolo Colet said some traders are expected to take profits this week after the index climbed by as much as 3.85 percent last week.
Colet said a technical correction could provide opportunity for some investors to accumulate on dips as they position ahead of President Ferdinand Marcos Jr.’s State of the Nation Address and the US Federal Reserve’s policy rate announcement later this month.
“It is also important to keep a close eye on foreign fund flows as sustained net foreign buying would be crucial for the market’s strength,” Colet said.
Colet said index may retest the durability of the 6,530 to 6,580 support zone this week.
He said that if prices hold above those levels and close atop 6,600 by the end of the week, the market could build a base for further bullish action heading toward the end of July.
The index gained 245.76 points week-on-week to close at 6,624.79 last week after the latest the US June inflation rate eased to 3 percent from 4 percent in May.
