Stocks are expected to move sideways this week, amid the lack of market movers on overseas and domestic fronts.
Analysts said, however, that stocks could draw strength from window-dressing, referring to the strategy by listed companies to improve the appearance of a stock’s performance before presenting it to clients or shareholders at the end of the quarter.
“We can expect a sideways direction for [this] week’s trading as there are no big risk events in sight both locally and globally. But then again, the third quarter will end next Friday so we will not be surprised if a window-dressing takes place,” RCBC Securities analyst Ralph Christian Bodollo said.
Stock broker F. Yap Securities Inc. said the market’s current sideways movement could be used by fund managers as an opportunity to scout for stocks that were likely to outperform, especially in the last quarter of the year.
“Run-ups may also come from spilled over positive sentiment from the latest Federal Reserve decision and reduced possibility of an interest rate hike in its next meeting in November due to US elections,” F. Yap Securities said.
The Philippine Stock Exchange index, the 30-company benchmark, gained 2.3 percent last week to close at 7,723.60 Friday, while the broader all-share index climbed 0.6 percent to 4,586.71, after the Federal Reserve decided to keep benchmark interest rates steady.
All subindices ended in the green, led by mining and oil which jumped 4.4 percent, services which rose 3.8 percent and property which advanced 3.6 percent.
Foreign investors continued to cut their positions in the local equities market, as net foreign selling reached P1.91 billion.
Average value turnover dropped to P7.4 billion from the previous week’s average of P9.83 billion.
The foreign outflow of funds is expected to be decrease after credit rating agency S&P Global Ratings retained the Philippines’ long-term credit rating of ‘BBB’ with ‘stable’ outlook.
Top gainers last week were International Container Terminal Services Inc. climbed 7.1 percent to P81.60, Globe Telecom Inc. which rose 6.6 percent to P2,092 and GT Capital Hildings Inc. which increased 5.4 percent to P1,480.
Heavy losers were Vista Land & Lifescapes Inc. which fell 5.1 percent to P5.17, LT Group Inc. which retreated 2.8 percent to P16.36 and Rizal Commercial Banking Corp. which went down 2.7 percent to P35.95.