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Sunday, June 23, 2024

PH stocks seen trading sideways this week

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Philippine stocks are expected to trade sideways with a downward bias this week following the hawkish stance by the US Federal Reserve and as the peso stays above the 58 against the US dollar level.

Online brokerage firm 2TradeAsia.com said lingering concerns on the macroeconomic environment due to inflation risks and further delay in interest rate cuts are big factors causing market volatility.

“The PSEi [Philippine Stock Exchange index] remains range-bound around the 6,400 to 6,800 band, with macro downside risks preventing any propulsion towards the medium-term resistance of 6,800,” 2TradeAsia.com said.

“Bountiful speculation should provide opportunities to range trade, albeit recent headlines have tilted to the downside That being said, the best entry point is the point of maximum pessimism,” it said.

It said mid-year expectations were shifting because of changes in macro-environment brought about by weakening of the peso against the dollar, sticky inflation and likelihood of La Nina.

The bellwether PSEi traded nearly flat last week, rising only by 0.02 percent to close at 6,619.89, while the broader all-shares index moved 0.02 percent to 3,523.49.

Average daily turnover declined to P6.35 billion from the previous week’s level of P9.58 billion.

Foreign investors were net sellers last week by P511 million, after the previous week’s net buying of P2.8 billion.

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