Index seen breaching 6,500

MANILA, Philippines — After finishing strong last week, the next target and resistance level for the Philippine Stock Exchange Composite Index is at 6,583.84, according to analysts.

The next target is the 6,700 level, which is the next important hurdle or breakout point prior to further upside potential, going forward, said Michael Ricafort of Rizal Commercial Banking Corp.

Last week ,the PSEi gained for the fifth straight day, rallying by 139.43 points or 2.2 percent to close at 6,484.06.

This is a new 4.5-month high since June 10 as new COVID-19 local cases continued to ease to the 1,000 levels for the fourth straight day. This was lower compared to the usual 2,000 to 3,000 cases each day.

Ricafort said continued measures to reopen the economy, progress on the US stimulus discussions between the Republicans and Democrats and the approval of the Remdesivir drug by the US Food and Drug Administration (FDA) to treat COVID-19, all contributed to investors’ optimism.

“The PSEi was also higher after the latest moves to further reopen the local economy such as allowing some foreign nationals to enter the Philippines starting Nov. 1, higher capacity for religious gatherings to 30 percent from 10 percent in some areas, further easing restrictions on some public transportation such as motorcycle taxis, and full 100 percent capacity for hotels in some areas, and allowing the reopening of some tourist areas recently,” Ricafort said.

Net foreign buying at the local stock market reached $16.4 million on Oct. 23, the most in more than two months.

Last week, the PSEi gained by 585.59 points or 9.9 percent, among the best performers worldwide, largely triggered and sustained by the approval of the P4.5 trillion 2021 national budget by the House of Representatives at the third and final reading exactly a week ago.