Local stock market may start anticipating the nearing third quarter corporate earnings season as early as this week, which is hoped to cheer Philippine shares in the next few days.
Abbygayle Estrella, analyst in AB Capital Securities Inc., said the market may move higher this week given the nearing earnings season, thus, corporate news may largely be significant to the sentiments of the market in the next few days.
“The fears that dominated sentiments in the last month or so, owing to a series of challenges that threatened to derail global optimism have faded to the background—at least in the interim. Trades moving forward will be hinged on the release of third quarter earnings numbers,” Jun Calaycay, Accord Capital Equities Corp. analyst, said.
Calaycay also pointed out that nevertheless, some degree of wariness may linger as the underlying issues that gave rise to the United States (US) shutdown and the budget tensions are still outstanding and unresolved.
“What the US Congress and the White House will do in the next six weeks will determine whether or not global financial markets will go through a repeat of this experience early next year,” he added.
Meanwhile, Estrella also specified that there will be a huge chance that the market may find it hard to break the next resistance level which is 6,660 within this week.
Overseas, she noted that there may no actually specific news being anticipated that could be crucial to the movement of the local stock market.
For his part, Philippine Stock Exchange President and Hans Sicat said the risk element for the market is already gone.
“Given the new lease of life of the US economy, I am hopeful our market will once again trek a growth path prior to the volatilities triggered by Bernanke’s statements in May. We believe the growth story and the potential of our economy and we see no reason why this would reverse anytime soon,” Sicat said.
“No reason to think of any negative thoughts,” he added.
Last week, Philippine share prices extended its latest run to three days, rising in 10 of the last 12 sessions.
“It [PSEi] continues to add to the gains since Day One of the US shutdown, edging closer to the 6,600-levels, a seeming irony in light of the expressed pessimism that characterized that period,” Calaycay said.
“Nevertheless, local sentiments may have been buoyed up by successive upward revisions of the growth outlook and the credit rating upgrade received from Moody’s. Adding to the north winds are anticipations of 3Q corporate earnings,” he added.