The stock market will look overseas for cues this week, particularly the upcoming US earnings season and whether there will be further fallout from Portugal’s financial woes, which sent European markets tumbling last week.
Astro del Castillo, managing director at First Grade Finance Inc., said the mood of the country’s equity market will continue to be dictated by overseas developments.
In the US, major tech issues including Intel Corp, Yahoo Inc., eBay Inc and Google Inc will be reporting their results sometime this week, with a sprinkling of economic data also expected.
“For next week, we should continue to monitor key indicators abroad, especially in the US,” said Lexter Azurin, research analyst at Unicapital Securities, Inc., referring to upcoming US retail and manufacturing figures and housing data.
“Those are the significant key economic data which may give direction to where the market will be headed,” he said, adding that the results seasons could bring about some volatility on Wall Street.
On the domestic front, Azurin said he is not seeing any developing leads as yet.
”This week we expect the market to trade in a range of 6,900-7,000 [points]. 7,000 remains to be a formidable resistance ahead of second quarter 2014 earnings season, which is set to start this end of July,” Gab Aguila, analyst at DA Market Securities, said.
“Should foreign markets continue to exhibit weakness over Friday’s trading session in the Western hemisphere, we may cue off to a further decline to the next support at 6,830. Overall, we expect the market to be sustained at levels higher than the previous consolidation,” he added.
US stocks fell Thursday last week on fears about financial stress in Portugal but recovered on Friday led by a rally in internet stocks. But European markets remained in the red on fears over the stability of Portugal’s banking industry and European banks in general.
Azurin noted that the market may still trade sideways after hovering to its highest level in early July.
Philippine shares ended lower on Friday, tracking the declines overseas amid concerns over Portugal’s financial system and European banks’ stability as well.
At the Philippine Stock Exchange, the benchmark index lost 36.12 points or 0.52 percent to close at 6,901.09, while the broader all shares index dropped 0.48 percent or 20.10 points to 4,136.50.