Market seen consolidating this week
Iris Gonzales (The Philippine Star) - August 26, 2019 - 12:00am

MANILA, Philippines — The stock market is seen consolidating on this shortened trading week due to a lack of clear immediate catalysts.

Traders said downside risks remain even as the benchmark Philippine Stock Exchange index (PSEi) rose last week for the first time in five weeks.

The PSEi, the stock market gauge, finished at 7,889.41, up 0.52 percent. It rose by 1.20 percent week-on-week for the first time in five weeks to 7,889.41 on some bargain hunting activities.

“The week’s close at 7,889.41 continues to signal the market to consolidate within the 7,700 to 8,000 levels in the near-term. However, downside risk remains towards the 7,500 levels. If said levels are broken we could see a retest of the 7,000 to 7,300 levels,” BDO said in a commentary.

Market investors also gobbled up the first initial public offering for the year, that of Kepwealth Property Philippines Inc., which has already hit its ceiling last week before ending at P15 per share, down 18.12 percent.

Traders said the market would continue to look for leads this week, including clearer directions on where the offshore gaming would go given the impact of this on property companies.

Megaworld, the largest office landlord, was down P4.80 per share or 0.80 percent.

The US-China trade war is also a lingering concern.

“The PSEi may have ended with gains this week after finding strength at its support level of 7,750. However, we are still convinced that this market will continue to go lower. Several factors like the ghost month and massive foreign outflows are already holding this market back and with an increase in tensions in this trade war, we will see more investors flee to safehaven assets like bonds and gold,” said Christopher Mangun of AAA Securities.

Another factor could be the weakness in the currency which gives foreigners an advantage for going back into the greenback, he said.

“That being said, picking up blue-chips in the following weeks at massive bargains may prove to be profitable in the long run. We see investors continue to look at second-liners and speculative issues as the performance of the recent IPO has given some optimism that there is money to be made in this market. We have another shortened trading week due to the holiday,” Mangun said.

The Philippine stock market is closed today in celebration of National Heroes’ Day.

  • Latest
  • Trending
Are you sure you want to log out?
Login is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

or sign in with