Market to trade in narrow range

Share prices will likely trade on narrow range this week as investors remain cautious given the current COVID-19 situation in the country.

Analysts said the geopolitical tensions between Philippines and China was also adding to the worries of investors.

“Threat of the ECQ-inducing COVID spikes and the escalating tensions in the West Philippine Sea rain clouds over the horizon, with might pull the lower index from its current base-building phase,” online brokerage firm 2TradeAsia.com said.

“Stay selective on trades. Immediate support is 6,400 and resistance is at 6,600 to 6,650,” it added.

Investors will also monitor the release of first-quarter earnings of listed companies to get indications and outlook for the rest of the year.

The bellwether Philippine Stock Exchange Index slipped 0.8 percent to 6,494.81 as Metro Manila and nearby provinces were placed under modified enhanced community quarantine until the end of April.

Three of the six sectoral indices posted week-on-week declines, led by industrial which fell 3.2 percent, property which dropped 1.7 percent ,and holding firms, which lost 0.2 percent. The mining and oil index jumped by 5.6 percent after President Rodrigo Duterte lifted the moratorium on new mining agreements.

Foreign investors were net sellers for the week by P4.1 billion while the average daily value traded was flat at P5.5 billion.

Weekly to price gainers were Philex Mining Corp., which advanced 9.2 percent to P5.10; Cebu Air Inc., which surged 6.6 percent to P50.10; and Eagle Cement Corp., which rose 5.6 percent to P11.62.

Weekly top price losers were Universal Robina Corp., which dropped 9.5 percent to P128.50; DMCI Holdings Inc., which declined 8.3 percent to P5.27; and Megaworld Corp., which was down 7.4 percent.

Meanwhile, global stocks rallied Friday, with major indices hitting new all-time highs, following data showing record economic growth in China and additional acceleration in the United States.

China saw expansion of 18.3 percent in the first quarter, boosted by a sharper-than-expected increase in retail sales.

The economic growth figure was the highest since records began three decades ago, enhanced by its chronically weak comparison figure from last year, though the reading was slightly below forecasts in an AFP survey.

“The national economy made a good start,” National Bureau of Statistics spokeswoman Liu Aihua told reporters Friday.

In the United States, new housing starts jumped 19.4 percent in March, while housing permits also outperformed expectations.

The data came on the heels of strong government reports on employment and retail sales released Thursday.

“We had tremendous data all week this week,” said Chris Low of FHN Financial.  

“In addition to strong data, we get reassurances from Fed officials all week, including the chair, that they’re very comfortable with the economic and inflation environment… so that’s good news for equities, as well.”

Both the Dow and S&P finished at fresh records Friday and also posted their fourth consecutive weekly gains. With AFP