Volatile market seen this week

Trading on the Philippine Stock Exchange is expected to remain volatile this week amid economic uncertainties and nervousness over the incoming new administration.

Analysts said rising inflation and interest rates remained the top concern for investors as these factors could slow the recovery of the domestic economy.

Investors will monitor the plans and policies of the new administration, especially to ensure the growth of the national economy.

“Experts have indicated that the new Marcos administration will be polarized, but capital markets are so far welcoming the return of household names to critical cabinet positions,” online brokerage 2TradeAsia.com said. .

“The economic team ranging from the BSP (Bangko Sentral ng Pilipinas) to the finance bureau, made up of technocrats who were part of previous historical GDP growth cycles, should bring some calm, especially when the investment rating of the country is in question, instead of a less favorable fiscal situation, high inflation and post-pandemic fundamentals, he added.

Last week, the Philippine stock index slid 0.3% to close at 6,726.14 after the BSP hinted at another rate hike at the upcoming June meeting, while the headline All Shares fell 0.5% to 3,596.13.

Five of the six sector indices recorded week-over-week declines, led by financials, which fell 1%; holding companies fell 0.6%; mining and oil fell 0.3%; property lost 0.3%; and the industry fell 0.2%. The services index, meanwhile, rose 0.6%.

Sales abroad accelerated to 9.8 billion pesos last week from 623 million pesos the previous week, while the average daily value traded increased to 8.9 billion pesos from the previous week’s average of 7.6 billion pesos.

The top weekly price gainers were Manila Water Co. Inc., which rose 7.5% to P18.70; Aboitiz Equity Ventures Inc. which rose 6.2% to reach P51; and International Container Terminal Services Inc., which climbed 5.9% to 222.80 PPP.

The biggest weekly losers were DITO CME Holdings Corp., which fell 7.5% to 4.57P; First Gen Corp., which fell 6.1% to 19.20 PPP; and Bloomberry Resorts Corp., which fell 5.4% to 6.25 PPP.

Meanwhile, global stocks rose on Friday, with U.S. indexes posting a plunge in weekly losses, while oil prices hit their highest level in two months.

After a positive day on European and Asian markets, Wall Street stocks enjoyed another session entirely in positive territory, ending higher for a third consecutive session.

So far, 2022 has been a stunning year for US equities as the Federal Reserve has launched aggressive moves to tighten monetary policy in response to inflation.

But the Dow ended at 33,212.96, up 1.8% for the day or 6.2% for the week. The index had posted weekly losses for the past eight weeks.

“The market itself was oversold and we knew we were overdue for a rebound,” Quincy Krosby, chief equity strategist at LPL Financial. With AFP

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