Positive sentiments to buoy market this week

MANILA, Philippines -  The stock market is expected to move between the 7,000 and 7,400 level this week on positive investor sentiment, analysts said.

Jonathan Ravelas, chief market strategist at Banco de Oro said the benchmark Philippine Stock Exchange index (PSE) is seen moving between the 7,000 and 7,400 level this week.

Ravelas said anything above that level could sustain a more positive sentiment in the market.

 “The week’s close at 7,345.02 still suggests the market to remain range bound between the 7,000 and 7,400 levels in the near term. A break above the 7,500 levels could call the bulls back into play,” he said.

In a separate comment on last week’s session, online market research portal 2TradeAsia.com said the statement of the US Fed that the pace of rate hikes would be gradual, boosted market sentiment.

The PSEi rallied by 2.78 percent week-on-week to 7,345.02.

 “Local benchmark rose during the week, as investors’ concerns eased on the Fed’s interest rate stance.  The Fed’s dovish tone provided relief, after retaining their earlier indication of three hikes for the year,” it said.

In addition to the US Fed’s dovish stance, the pronouncements of the Bangko Sentral ng Pilipinas (BSP) that it would keep rates unchanged also provided relief to jittery investors.

The PSEi climbed 199 points to close at 7,345, up 2.78 percent week-on-week, with all sectors in positive territory. However, weak breadth prevailed, 97 to 89, with turnover leaning at P7.6 billion on average. Net foreign outflows for the week were recorded at P200 million, 2TradeAsia said.

The market is likely to watch out for the G20 meeting of central bankers and finance minister now that the US Fed meeting is over.

“As the market shifts focus from the most awaited Fed policy meeting last week to various central bankers and finance ministers’ G20 meeting, investors are expected to closely monitor how these nations would address the looming protectionist policies and border taxes the US is planning to implement. Furthermore, with growing populist movements around the globe, investors would want to know the schemes G20 leaders will undertake to promote globalization in trade policies,” it said.