Philippine stocks are expected to trade sideways this week amid a lack of catalysts to push the index higher.
Online brokerage firm 2TradeAsia.com said over the weekend the benchmark Philippine Stock Exchange index (PSEi) is hampered by weakness in property and holding firms, which are index heavyweights.
Overseas developments, particularly economic policies by the Trump administration and a dovish stance by the US Federal Reserve, are also contributing to the market’s overall weakness.
“Expect protracted risk-off sentiment pending stabilization of external noise, particularly concerning inflation-interest rate trends and geopolitics as the second quarter approaches,” 2TradeAsia.com said.
“Stay liquid for opportunities while the index finds a stronger identity around 6,000,” it said.
Meanwhile, the Philippines’ exit from the Financial Action Task Force’s (FATF) gray list is expected to attract more foreign investors to the stock market.
“With our exit from the FATF gray list, we are optimistic that the international community will see the Philippines as an even more attractive destination for business and investment,” Securities and Exchange Commission chairman Emilio Aquino said.
The market’s support is seen at 6,000 this week, while resistance is at the 6,300 to 6,400 level,
The PSEi rose 0.61 percent last week to close at 6,098.04, staying above the 6,000 level. The broader all-shares index climbed 0.85 percent to 3,660.28.
The average daily value traded declined to P5.74 billion from the previous week’s average of P5.44 billion.
Foreign selling accelerated to P2.73 billion, up from the previous week’s outflow of P2.62 billion.