Despite having re-entered the 6,700-point psychological resistance mark, Philippine shares may still be largely affected by the rising tensions in Ukraine, which worsened over the weekend after Russia called for an emergency meeting of the United Nations Security Council over the crisis.
“Developments over the weekend pose a challenge to sentiment moving into this week’s trades,” said Accord Capital Equities Corp. analyst Justino Calaycay.
The standoff in Ukraine turned violent after armies backed by the interim government in Kiev laid siege to rebels holding government buildings east of the country a few miles away from the border where Russian troops have been massing, Calaycay noted.
“Beyond the travel and asset freeze sanctions imposed by the West on Russian and pro-Russian political and business leaders and personalities, concerns over the crisis’ impact on oil prices have tempered optimism in the marketplace,” he emphasized.
On Friday, Brent crude rose $0.83 to $108.59 per barrel, while West Texas intermediate crude for June delivery added $0.34 to $99.76 per barrel.
Also on Friday, stocks in the Asia Pacific region ended the week on a positive note following the Labor Day holiday.
Local share prices extended their winning run to a third day on Friday, helping the Philippine Stock Exchange index (PSEi) end the week up 0.87 percent and above the 6,700-mark for a second day.
The three-day advance, aggregating 138.62 points or 2.1 percent, reversed a previous four-day slide, which in turn was preceded by a four-session run up.
“If this trend continues, the PSEi is poised for at least another day of advance, which if it moves and closes past 6,784.95, will sustain the higher-high, higher-low series. The recovery last week erased three-fourths of the losses sustained in the preceding slump,” Calaycay further said.