Philippine stocks are expected to sustain their sideways movement this week as investors anticipate possible policy decisions by the US Federal Reserve and the Bangko Sentral ng Pilipinas.
Analysts said investors were still cautious due to uncertainties in the macroeconomy, particularly about inflation and interest rates
“We still expect the cautious atmosphere to remain in the local bourse amid the lack of fresh leads. Investors are expected to wait for new catalysts. Till then, cues are expected to come from other financial markets,” Philstocks Financial Inc. research head Japhet Tantiangco said.
Tantiangco said the continued rise of long-term treasury yields may pull the equities market lower, while a drop in rates may lead to the opposite.
“Investors may also watch the movements of the local currency against the US dollar, with an appreciation expected to help, while a depreciation is seen to weigh on the bourse,” he said.
With the recent decline in share prices, traders are also seeing opportunities for bargain-hunting as many stocks offer attractive levels,
The market turned more bearish last week, as the 30-company Philippine Stock Exchange index fell 2.22 percent to close at 6,352.12. The broader all-shares index also lost 0.28 percent to settle at 1,508.98.
The market’s support is seen at 6,150, and resistance at 6,400 this week.
Average value turnover improved P5.45 billion from the previous week’s average of P4.27 billion.
Foreign selling accelerated to P3.3 billion from the previous week’s P1.64 billion.