• GDP play, earnings narrative, Fed rate hike to rule PSE trading

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    Three significant catalysts are likely to dominate trading on the Philippine Stock Exchange: the third quarter Philippine gross domestic product (GDP), corporate earnings and the Fed rate hike later this year.

    The US economy grew by 2.9 percent in the third quarter of the year, its strongest in two years, pointing to the likelihood of a Fed rate increase in December.

    “Given the data lag, however, December’s much-awaited rate hike is seen, a move that could lead to significant liquidity swings,” 2TradeAsia.com said.

    For its part, BPI Asset Management sees the benchmark PSEi tracking global markets in the absence of significant catalysts on the domestic front. “For next week, expect the PSEi to trade between 7,300 and 7,700.”

    But given the global uncertainties over the impending Fed rate hike, Justino Calaycay Jr. of A&A Securities noted how domestic corporate results in July-September would get the market’s attention

    “By next week, attention should shift to the third quarter corporate earnings narrative, and at least temporarily, a respite from the uncertainties arising from the country’s diplomatic pivot towards the ‘East.’ Further down the road, sometime late November, the all-important third quarter Philippine GDP will provide the benchmark for the Duterte administration, and quite possibly, the investment outlook,” Calaycay said.

    On Friday, the PSEi decline by 0.54 percent or 40.34 points at 7,404.80. The wider All Shares decreased by 0.47 percent or 20.72 points at 4,398.58.

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