Surprisingly strong third quarter growth results are expected to figure in stock market trading this week after initially being ignored by investors.
“We had very positive GDP (gross domestic product) numbers come in and I think we are going to see a positive effect on the index in the following weeks,” Eagle Equities, Inc. research head Chris Mangun said.
“I think we are going to test resistance at 8,400 and then at 8,500 possibly even testing 8,600 for a new high,” he added.
The government last Thursday announced that the economy had grown by a better-than-expected 6.9 percent in the third quarter, surpassing expectations of a 6.6-percent expansion at best.
The news, however, failed to lift the Philippine Stock Exchange index (PSEi), which that day declined by nearly 1 percent or 67 points to 8,206.44 as investors focused on US market declines said to have been caused by worries over US President Donald Trump’s tax plans.
Analysts again pointed to progress in Trump’s tax proposals on Friday after the PSEi added 1.27 percent or 104.64 points to close at 8,311.08. The broader All Shares rose 0.81 percent or 39.14 points to finish at 4,873.82.
In a separate comment, online brokerage firm 2TradeAsia said hiccups on the local market were due to some fund managers realigning portfolios “either to finance redemption needs, or possibly reallocate cash in favor of productive sectors that could deliver higher returns.”
“Gaining traction also takes time, necessitating build-up in momentum,” it noted.
“During these pauses, however, opportunities arise for those who are able to view the bigger picture ahead,” 2TradeAsia said.