The direction of oil prices will likely dictate how the stock market fares this week, analysts said, noting that investors remain risk averse given continued global volatility
AB Capital Securities Inc. analyst Victor Felix noted that a Russia and Saudi Arabia-led move to freeze oil output had briefly pulled up prices, and stock markets subsequently. The rally, however, was shortlived as skepticism returned.
“We will be tracking, again, the crude prices. That will be the main driver of the stock market this week, Felix said, adding that concerns would be heightened by possible job losses for Filipino workers in oil-producing countries.
Risk aversion remains with the national election campaign also having kicked off, Felix added.
“At present, investors are risk averse. Even our foreign direct investment is trickling down since certain candidates for the national elections … are not doing very well in the surveys. Hence, it creates a certain level of uncertainty,” he claimed.
Jason Escartin, analyst at 2TradeAsia.com, said that regardless of the outcome of the national elections, investors are still hopeful reforms implemented by the incumbent government would continue
“While the political air could add up … the view should stabilize post-election as attention reverts to sustainable fiscal and economic policies,” Escartin said.
Last Friday, the benchmark Philippine Stock Exchange Index (PSEi) fell by 0.83 percent to 56.81 points to close at 6, 792.06, while the wider All Shares index lost 0.55 percent or 21.74 points to finish at 3, 917.29.
Luis Limlingan, head of research at Regina Capital Development Corp. said there were indications of a “buying mood.”
“[W]e are … seeing investors who are slowly buying so as to take advantage of the good valuation of shares,” Limlingan said.