CEBU, Philippines - The nation's stock market has reached the 'resistance' stage where sellers are likely going to beat stock buyers causing the capital market to go down.
Although the demand in the market may be decreasing now, it can still go back to the 'support' status, said Marco Nino Velasco, business development officer of UniCapital Securities, Inc.
"Resistance that means nobody wants to buy in the market, so demand is diminishing," Velasco said in an interview with The FREEMAN.
On the other hand, the market experiences the support level when buyers are probably overwhelming the sellers causing the stock to go up.
He said that the resistance can be attributed to the performance of late investors who have seen the price going down that is pushing them to sell stocks to manage a break even.
"Seeing it, medyo temporary lang ni sya," the stock broker said. "Maybe it will last for a year lang. But all in all, looking at the general perspective, expected that we are good so far."
Recently, the Philippine Stock Exchange index has reached 6850.60 in July.
Velasco explained the increase can be credited to the buoyed manufacturing data of United States and China for June. In fact, factory data went up also in Europe and Japan.
In a long-term perspective, Velasco has foreseen that PSEi will eventually hit back an all-time high record at 7,400–probably by December.
With the resistance being felt in the market now, he though expressed that the bear market or the situation when investment stock prices fall down will unlikely happen in the future.
He noted: "Mura’g layo rana. In fact, reports said the chances is so slim and it may even be close to zero."
The most important factor to note, however, is the continuous flow of investments and that there is no way for the market to really go down.
He, however, said that several analysts predict the change of administration in 2016 may affect the condition of the capital market: "But that does not guarantee nga mo-drop gyod ang market but it may be a determining factor that the next president may not be good as PNoy (Aquino)."
He also added the trust of the future investors to the next leader may not be the same to the trust that President Aquino has been receiving now. (FREEMAN)