Stocks are expected to keep moving sideways this week, as investors take a defensive stance amid the uncertain developments overseas.
Online brokerage firm 2TradeAsia.com said despite the positive earnings reported by listed companies, investors would wait for key macroeconomic catalysts before moving away from current defensive stance.
“For now, it would be prudent to maintain a defensive stance, as markets are still waiting for key macro catalysts,” 2TradeAsia.com said.
Immediate support is seen at 7,200 and resistance at 7,350 to 7,400.
The Market Call, the joint publication of First Metro Investment Corp. and University of Asia and the Pacific capital markets research, said in its latest issue it did not see any positive catalyst for local equities in the next two months.
“If at all, the headwinds appear daunting. These include the strengthening of US economy and dollar and its negative effect on the peso and the economic fundamentals on the external side show some cracks as the current account looks headed towards a deficit as a result of years of an overvalued currency,” it said.
The publication said given the market’s current trend, investors should be patient, search for value stocks and enter the market on downturns.
The Philippine Stock Exchange index, the 30-company benchmark, closed lower by 1 percent over last week’s five-day market trading to 7,269.62 on March 24, while the broader all-share index went down 0.9 percent to 4,376.74.
BDO Unibank Inc. chief investment strategist Jonathan Ravelas said investors were recalibrating expectations to reflect the reality that US President Trump’s pro-growth agenda would not push through overnight.
“This affected local investors’ sentiment which caused some profit taking,” Ravelas said.
Major subindices ended mixed, with holding firms, services and mining and oil posting week-on-week gains, while financials, industrial and property registered weekly declines.
Foreign investors were net sellers last week by P3.3 billion, while average daily turnover eased to P7 billion from the previous week’s average of P8.3 billion.
Top gainers last week were Melco Crown (Philippines) Resorts Corp. which advanced 7.1 percent to P6.19, PLDT Inc. which climbed 3.8 percent to P1.570 and Aboitiz Equity Ventures Inc. which rose 3.3 percent to P75.30.
Heavy losers included Metro Pacific Investments Corp. which dropped 7.3 percent to P6.03, Ayala Land Inc. which dipped 5.6 percent to P34.50 and Robinsons Retail Holdings Inc. which went down 5.3 percent to P77.50.
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