Amid surprisingly numerous breaks, Philippine shares seem to have lost track of possible leads on the local side and may turn even weaker in the upcoming days still on Federal Reserve concerns, among other global uncertainties.
“The near-term outlook, which remains largely negative. clouds over what should be a still encouraging outlook for the longer investment horizon. The release of the minutes of the Fed’s most recent meeting supported what the ‘silent majority’ understands – that tapering is inevitable, only the timing is uncertain,” Jun Calaycay, Accord Capital Equities Corp. analyst, said.
“The next critical date for this issue that have lingered over the collective consciousness of the market is mid-September when the Fed meets again,” he added.
Calaycay even cited that in the specific case of the Philippine equity market, investors may not be encouraged to hold significant positions going into yet another extended weekend.
“Chartwise, the index tested the 6,000 [-point] level and fell below the 200-day moving average. A break below 6,000 may signal further losses towards the 5,650-5,800 levels,” Jonathan Ravelas, chief market strategist of BDO Unibank Inc., said.
Nevertheless, Calaycay still pointed out that the presence of bargain hunters should provide a buffer to the bear’s expected dominance, given the still intact fundamental strength of the country’s economy.
On the last day of the two-day trading week, the market ended flat, albeit on the green side, with majority of the sectors still idling on the red.
Astro del Castillo, First Grade Finance managing director, said that the market was flat after a last-minute bargain hunting occurred, with most investors opting to stay at the sidelines given another long weekend.
”Nobody wouldn’t want their funds locked up in a volatile market,” del Castillo further said.
Jovis Vistan, head of research of AB Capital Securities Inc., said that the market just took a break on Monday after the massive sell-off that occurred on Thursday’s trade, where the Philippine Stock Exchange index slumped by more than 6 percent.
On Monday, there was no trading to give way for the celebration of National Heroes’ Day in the country.
Last week, there was only two trading sessions after the market took extended break from last Monday until Tuesday, as Tropical Storm Maring and the southwest monsoon submerged most parts of Metro Manila and Luzon. There was also no trading on Wednesday as it took a break for another holiday, or the death anniversary of former Sen. Benigno Aquino Jr.