TRADING on the Philippine Stock Exchange will largely be influenced by second quarter earnings and global economic data, while the market remains in consolidation this week.
BPI Asset Management expects the benchmark PSEi “. . . to trade between 7,450 and 7,600 with the corporate results… to be the main catalysts.”
“Nonetheless, significant economic data overseas may also move the local market,” it added.
In a separate weekly report, AB Capital Securities Inc. said noted investors are on the lookout for US nonfarm payroll numbers as the data will play a signification role in the decision-making process of the US Federal Reserve in raising interest rates.
“Jobs . . . recovery is one of the critical components that the US Federal Reserve looks into in deciding its monetary policy decision and a stronger-than-expected number could spur the US central bank to raise rates in September,” AB Capital said.
For his part, Luis Limlingan of Regina Capital Development Corp. sees the market consolidating with “a slight bullish” trend this week “due to improved technical readings and a solid . . . low base.”
However, he cautioned investors to watch for potential support level breakdowns. If the index fails to hold the initial support at 7,467.13, then the next support level is at 7,272.36.
On the other hand, Jason Escartin, investment analyst at F. Yap Securities Inc., said investors should assess and revisit their positions in consumer stocks, holding firms and services that can possibly “ride out prospects for 2016.
“Spot for bargains . . . While oil prices continue to hit fresh lows, some mining and oil prospects could move out of the doldrums, as contrarians come in. Some players see demand for nickel for example, improving towards the end of the year, which could help the valuations of nickel operators. Also, the downtrend in oil prices could prevent new firms from accessing the downstream sector, enabling present players to build a stable base for margin expansion,” Escartin said.
The buy on dips, sell on strength strategy is still effective in this volatile market, he added.
On Friday, the main PSEi dropped 0.76 percent or 57.43 points to 7,532.52, while the broader All Shares fell by 0.63 percent or 27.33 points to 4,320.60.