RANGE trading is the name of the game as market players weigh corporate results to be released this week against their respective positions.
“We see the next wave of earnings results for financial year 2016 to be the primary driver of the market,” Ralph Christian Bodollo, equity research analyst at RCBC Securities Inc., said in a note over the weekend.
The PSEi traded around the 7,200 area last week after Ayala Land Inc. (ALI) and Jollibee Foods Corp. (JFC) registered positive results but the old adage buy on speculation sell on good news went into play. The Bank of the Philippine Islands posted a hefty increase in bottom line which goaded investors to accumulate shares.
Online brokerage 2TradeAsia.com said investors will continue to focus on earnings and the progress of industry-specific issue particularly affecting the mining sector.
Foreign investors are interested in how the ongoing controversy hounding the mining industry will be pan out and the “progress in resolving spats in identified industries, especially in honoring the sanctity of contracts in mining and other capital-intensive sectors,” 2TradeAsia said.
“The latter would be crucial in laying down the framework for the rollout of other infra-based initiatives, especially its impact on employment and foreign direct investments,” the brokerage said.
“The market may continue with its consolidation phase, with no new catalysts in place yet to trigger a sizeable run-up. Note that the PSEi formed a double-top pattern at 7,400 since the start of the year and funds flow has yet to reverse from the sell side,” it added.
Market-moving news from overseas included US President Donald Trump’s tax reform agenda, US labor statistics and developments regarding the US interest rates. The Federal Reserve is having a policy- meeting next month.
On Friday, the benchmark PSEi declined by 0.53 percent or 38.46 points to 7,244.79, while the broader All Shares decreased by 0.31 percent or 13.78 points to 4,388.01.