The Philippine Stock Exchange Index may climb past the 8,000-point mark again this week on improved sentiments and easing trade tensions between the US and China.
The breakout to the 8,000 level will depend on developments overseas. “Whether the index breakout of the 8k mark should be reliant on US market movement in the coming days, and if foreigners continue their inflow like today,” Papa Securities trader Gabriel Perez said.
While stocks have recovered from the 7,700-point level, First Metro Investments Corp. expects upcoming trading sessions to remain bumpy as negative stimuli appear to surpass positive ones.
Among the positives which could provide a boost the market are the persistent fall in inflation and interest rates and lower-than-expected balance of trade deficit in June.
“In short, it looks like the sun would rise only after the typhoon season has burst the dark clouds,” FMIC said.
The PSEi last week closed at 7,979, up 1.1 percent week-on-week amid positive developments on the US-China trade talks and month-end window dressing
The broader All Shares Index also climbed 0.8 percent week-on-week to close at 4,809.
Except for the property index which declined 0.5 percent, all other sub-indices ended in the green. The mining and oil sector was the biggest gainer, rising 2.2 percent, followed by services which climbed 2.1 percent. Holding firms also gained 1.9 percent, while the industrial and financial index rose 1.2 percent and 0.3 percent, respectively.
Foreign investors were net sellers for the week by P2.15 billion, while the average daily value traded stood at P10 billion from the previous week’s average of P7.6 billion.
Weekly top price gainers were ABS-CBN Corp., which climbed 8.8 percent to P20.20; Security Bank Corp., which advanced 7.5 percent to P204; and Globe Telecom, which rose 6.9 percent to P2,030.
Weekly top price losers were Kepwealth Property Philippines Inc., which dropped 27.2 percent to 10.92; Pilipinas Shell Petroleum Corp., which fell 11.5 percent to P31.40; and San Miguel Food and Beverage Inc., which lost 7.7 percent to P90.
Renewed hopes for trade talks, meanwhile, kept stock markets mostly in the black on Friday after China suggested this week it might not retaliate against the latest US tariffs.
The relative calm made for a mostly positive final day to a bruising month, when economic and trade war fears eroded gains from June and July.
European bourses posted modest gains while Wall Street swung to a split finish after a choppy session, following mixed economic news on consumers and ahead of sharp increase in US tariffs on Chinese imports planned for Sunday.
Despite recorded gains for the week, the major New York indexes finished the month in the red for the first time since May.
“We may be facing up to the reality of recession but optimism continues to flow through the veins of investors following comments from the Chinese Commerce Ministry on Thursday,” said Craig Erlam, senior market analyst at Oanda trading group.
The apparently easing tensions helped China’s yuan strengthen slightly against the dollar, having fallen to an 11-year low earlier in the week. With AFP