PSEi may stay above 8,000 this week

MANILA, Philippines - The benchmark Philippine Stock Exchange index (PSEi) may continue to fight to stay above the 8,000 mark this week after it reached a new high last week.

Jonathan Ravelas, chief market strategist at Banco de Oro, said the positive second quarter economic growth which beat expectations boosted confidence.

“This boosted investor sentiment causing share prices to rise. The market printed a high of 8,105.01 last week,” Ravelas said.

Last week, the PSEi rose 1.11 percent week-on-week to 8,016.73 after the government reported a second quarter GDP growth of 6.5 percent.

This was above market expectation of a 6.4 percent GDP.

The expansion was led by government consumption and investments, which grew 7.10 percent and 8.70 percent year-on-year, respectively.

“Chartwise, the week’s close at 8,016.73 continues to highlight that the market still has momentum to try the 8,100 to 8,150 levels. Immediate support and resistance is seen at 7,850 and 8,100 levels, respectively,” he said.

2TradeAsia.com said the abatement of political tensions between North Korea and the US also helped improve market confidence.

North Korea opted to defer the release of its military plan, pending statements from the US.

“All sectors landed green, paced by mining/oil (+2.14 percent), property (+1.64 percent) and industrials (+2.52 percent). Participation regressed 9.9 percent to P5.47 billion on average, with market breadth favoring bulls, 107-72. Net foreign buying stood at P183 million,” 2TradeAsia said.

For this week, 2TradeAsia said volumes may be affected because of the start of the Chinese ghost month.

“Volumes could thin however, with the start of the Chinese ghost month, with majority on cautious mode over political headlines,” it said.

It sees immediate support at 7,030 to 7,050, with resistance  at 8,080 to 8,100.