Stock exchanges will remain volatile
Trading on the Philippine Stock Exchange will remain volatile this week as concerns over rising oil prices are pushing inflation and interest rates higher.
Analysts said investors were concerned that prolonged high oil prices, coupled with a weakening peso against the dollar, could lead to lower corporate earnings due to margin pressures.
The upcoming presidential elections are also keeping investors on the sidelines.
Investors are eagerly awaiting the start of the earnings season which could provide an indication of how companies are performing this year.
“Note that we are one month away from what is being called the most polarizing national election in local history, a possible 50 basis point rate hike from the US Federal Reserve and an explosion in reports on earnings. Put the trade away and keep a cool head, as the market tries to find a better footing near the 7,000 level,” said online brokerage firm 2TradeAsia.com.
Last week, the Philippine stock index slipped 0.5% to 6,984.90 due to tight trading.
All the other sub-indices ended in the red, with the exception of holding companies. The mining and oil index fell by 1.7%, real estate by 1.4%, the financial sector by 1%, the industrial sector by 0.3% and services by 0.3%.
Foreign investors were net sellers for the week of 1.25 billion pesos, while the average daily value traded reached 4.19 billion pesos compared to the previous week’s average of 4.69 billion pesos. .
The top weekly price winners were Emperador Inc., which jumped 21.3% to 17.10 PPP; Wilcon Depot Inc., which rose 5.4% to 26.50 PPP; and Filinvest Land Inc., which rose 3.8% to 1.07 PPP.
The biggest weekly losers were PXP Energy Corp., which fell 10.1% to 4.90P; DMCI Holdings Inc., which fell 4.3% to 8.72 PPP; and Century Pacific Food Inc., which fell 3.6% to 22.65 PPP.
Meanwhile, Asian markets plunged on Friday after a negative lead from Wall Street as investors around the world worried about soaring inflation.
Central banks in several major economies, including the United States, Canada and Britain, have already started raising interest rates to contain prices, but the European Central Bank on Thursday stuck to its stimulus plans and its rates unchanged.
That sent the euro plunging to a nearly two-year low, but eurozone stocks were boosted as Wall Street retreated ahead of the Easter break.
The mood was also gloomy in Asia, where only a handful of markets were open on Good Friday.
The Nikkei 225 closed down 0.3% as Wall Street woes depressed sentiment.
Analysts expected China’s central bank to cut interest rates on Friday to support the COVID-hit economy.
But the People’s Bank of China left them unchanged.
“This is somewhat surprising given the deep economic downturn and recent calls from Chinese leaders for monetary support,” Julian Evans-Pritchard of Capital Economics said in a note.
“This underscores the central bank’s reluctance to aggressively ease policy. But we think he will have no choice but to do more before long.
Shanghai was down 0.5% at the close. With AFP