The Market Monitor Minding the Nation's Business
The local stock market index managed to stay above the 8,000 level last Friday as the downturn across regional markets weighed on the bourse. The Philippine Stock Exchange index (PSEi) lost 76.95 points, or 0.95 percent, to 8,025.35 from the previous day’s 8,102.30 finish.
“Regional markets are down. So it [local market] just followed, considering the fact we are one of the highest valuations in the region. Since others corrected, we were dragged by the other markets,” Aniceto Pangan, equity stock trader at Diversified Securities Inc., said in an interview.
Pangan expects the local bourse to recover next week, as more companies release their second-quarter earnings and President Rodrigo Duterte to deliver his first State of the Nation Address (Sona) on Monday.
“I think there is a possibility of beating its all-time high, which is 8,136,” he said.
Pangan cited in particular the Manila Electric Co. (Meralco), which will release its earnings data also on Monday.
“Actually, Meralco has a directly proportionate to the economic activity. The energy sales have direct relation to the economic activity of the Philippines,” he said.
The market’s decline was led by the 1.34-percent fall in the financial sector and the 1.31-percent drop in the property sector. Only share prices the mining and oil sector closed in the red.
Volume of transactions reached 975.6 million shares valued at P7.75 billion. Advancers outpaced decliners, 113 to 95, while 43 issues unchanged.
”With corporate earnings expected to flow in, the PSEi will probably pierce the all-time high [of 8,127, achieved in April last year] within the next 10 days,” said First Grade Finance Inc. Managing Director Astro del Castillo in an interview.
Del Castillo said any positive new developments from President Rodrigo Duterte, particularly during his Sona, could also provide further boost to the local bourse. Victor Felix, equity analyst at AB Capital Securities, attributed the market gains to the positive second-quarter earnings results that have started to be released.
”And investors may be positioning ahead of more favor-able results later this month,” Felix said.
“That said, selling pressure remains in trading, with investors seeing the 8,000 level as a chance to take profit, considering that this week is data-light in terms of macroeconomic news,” he added.