Market may sustain upward momentum this week
Iris Gonzales (The Philippine Star) - December 10, 2018 - 12:00am

MANILA, Philippines — The stock market may sustain its upward momentum this week, inspired by slowing inflation and easing crude oil prices.

In a report, 2TradeAsia said the market may continue its upswing past the 7,500 mark.

“If conditions go well in maintaining momentum, there might be chances for gauges to test the 7,900 to 8,000. The only condition that could jolt this trend is US-China trade war,” 2TradeAsia said.

Immediate support is seen at 7,400, while resistance would be at 7,600 to 7,700 level.

Optimists were recharged as investors positioned for good fundamental plays last week. The Philippine Stock Exchange index (PSEi) gained 93 points to close at 7,461 week-on-week.

It was primed by financials, which rose two percent and the industrials, which gained 1.8 percent. Property, too, was up 12.5 percent.

“Several took heart of slower inflation in November, indicating positive results from government’s drive to address supply bottlenecks in the economy. Average turnover slowed to P8.7 billion, down 30 percent although net foreign buying clocked in at P160 million,” 2TradeAsia said.

Gainers outmatched losers, 98 to 89.

The latest deceleration in inflation – six percent in November from October’s 6.7 percent might give monetary authorities room to keep rates unchanged in its last policy meeting for 2018 in the third week of December.

“If this is upheld, monetary authorities would provide room to aid consumer spending and possibly prod enterprises to tap on credit lines with banks, especially those with capital intensive expansion initiatives starting next year,” 2TradeAsia said.

Moving forward, the local equities market may only start to have a major upward move next year after the mid-term elections, according to the Market Call, a report jointly authored by First Metro Investment Corp. and the University of Asia & the Pacific.

It said that the PSEi is still weaving in and out of the bear territory and a major recovery is still not in the near horizon.

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