Sluggish stock market seen this week
Trading on the Philippine Stock Exchange is expected to remain volatile this week on concerns about high inflation and rates and a possible slowdown in economic growth.
Analysts said investors are anticipating economic headwinds from soaring commodity and fuel prices, which could drive up inflation and interest rates.
These factors dampen investor sentiments7 in the short to medium term, as they could lead to an economic slowdown.
If the markets continue to decline, analysts expect the index to test the 6,300 level.
Research analyst at online brokerage Niel Andrew Maderaje said investors are now waiting on whether the Bangko Sentral ng Pilipinas will raise key rates at its next meeting later this month.
“Global developments, such as the new COVID-19 lockdowns imposed in China and the US inflation rate for the month of May, also added to investor concerns,” Maderaje said.
Last week, the PSEI fell 3.1% to 6,530.04, while the overall All Shares Index fell 2.5% after a global sell-off.
All major sub-indices ended in red, led by mining and oil which fell 4.9%; holding companies which fell by 4.4%; services which fell by 4.2%; financials, which fell by 2.2%; property that lost 1.8 percent; and industrials, which fell by 1.5%.