Sideways trading seen on wait for new leads

MANILA, Philippines — The local stock market will continue trading sideways this week, with investors seen taking a cautious stance while waiting for fresh leads.

First Metro Investment Corp. head of research Cristina Ulang said the market is overbought and bound to be flattish to sideways.

The benchmark Philippine Stock Exchange index had a stellar showing last week, closing at 6,348.14 on Friday, up by 3.47 percent week-on-week.

Despite finishing in the red territory at 3,607 last Friday, the broader All Shares index also advanced by 2.56 percent week-on-week.

“Buying sentiment improved on expectations of a potential rate cut by the Bangko Sentral ng Pilipinas at its February meeting, which helped offset concerns over the peso hitting an all-time low and the release of recent unemployment data, which is higher compared to the same period last year,” Unicapital Securities head of research Wendy Estacio-Cruz said.

This week, Estacio-Cruz expects the local market to trade cautiously with a slight upward bias, as investors continue to weigh interest rate expectations, currency movements and upcoming economic data.

She said the market would also be looking forward to the release of November cash remittances on Jan. 15.

For Philstocks Financial research manager Japhet Tantiangco, the market may see strong selling pressures this week driven by profit taking following a three-week run.

“The local market has been exhibiting a bullish bias recently, rallying for three straight weeks and breaking above crucial lines including the 200-day exponential moving average which it last traded above in July 15 of last year,” Tantiangco said.

He said foreign investors have also been supportive recently, with the past week registering a net inflow of P2.16 billion.

“Investors may also move with more cautiousness while waiting for new catalysts. These include updates on the situation between the US and Venezuela, clues on the BSP’s policy path this 2026, movement of the peso and clues on the local economy’s growth trajectory,” Tantiangco said.

Tantiangco said the bourse may target its next resistance at 6,600 if it is able to take its resistance level at 6,400.