The Philippine stock market looks ready for a slow ascent in the next few days, with its path cleared of uncertainty after the US Federal Reserve affirmed its tapering policy, sending a clearer signal for a possible interest rate hike next spring.
”After months and months of guesswork, the market now has a clear reference insofar as the US stimulus and interest rates are concerned. Simply put, after the ‘fall’ it will ‘rise,’” Justino Calaycay of Accord Capital Equities Corp. said in a report.
Calaycay warned, however, that the local market may not be immune to a global equities slide that could be triggered by external factors, although the effect is expected to be “subdued,” and that should still enable the market to gain slowly in the coming days.
Joyce Anne Ramos of AB Capital Securities Inc. also believes the local bourse is set to “slowly inch upward,” although she does not totally discount “downward pressure on prices caused by negative market news.”
She said in a weekly market report if market developments turn positive, and traders engage in some window-dressing for the end of the first quarter, “we expect that the local bourse will slowly inch upward to test resistance at 6,550 and 6,570, and if those are breached, the next resistance level may be found at 6,660.”
”Downward pressure on prices caused by negative market news, however, may lead to a fallback to support levels at 6,300 and 6,270,” she said, adding, “investors should take profit on the abovementioned resistance levels and buy at near support levels.”
After a two-day gain at the beginning of last week, the Philippine Stock Exchange index slipped for a third day in a row on Friday, losing 1.22 percent or 78.09 points on that day to end at 6,339.26, while the wider all shares index dropped 0.84 percent or 32.57 points to 3,840.27.