• Stock market seen rallying this week

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    The stock market is seen to stage a rally this week after its significant 5-percent and 7-percent downturn on Tuesday and Thursday’s trading session, respectively.

    Harry Liu, president of Summit Securities Inc., said that the market is projected to rally throughout the week because of buying, as stock prices have become really cheap.

    “Expect a technical rally for the following days and consolidation to follow,” Liu said in a text message.

    He said that the market is oversold at the moment, which was brought about by the “sudden increase in demand of dollars, which precipitated to weaken the peso.”

    “Given that the market is oversold, there would come a time that prices of certain issues would fundamentally be viable to buying and investing,” Liu said.

    He added that “the demands are just coming in” from the previous market plunges, which made the market cheap and affordable.

    “[For short term], because it is oversold, we should expect that the market would go up in a week or two,” Liu said.

    For the long term, the market will continue to go undergo consolidation.

    “All the regions, even the US, market is volatile today. That is why we need to give the market time to consolidate. Let the market simmer down, to go under medium-term consolidation,” Liu added.

    He emphasized that the market went up ahead in the past few days, and the decline from last week is nothing to worry about as the market remains very stable.

    Astro del Castillo, First Grade Finance Inc. managing director, on the other hand, said that people should look into the activities of the foreign markets, as they more likely affect local trading.

    Del Castillo agreed with Liu that prices of issues nowadays are attractive, as hot money will continue flowing to the market.

    “But we will still take the same pace as the overseas market,” del Castillo said in a phone interview.

    “Until the jitters from foreign selling eases, market will rise to 7,000 points, maybe at the end of the year,” he said.

    Del Castillo also said that the market’s volatility gave analysts a hard time to predict price and index movements.

    “What’s happening right now is a phenomenon. Even other fund managers overseas are amazed at the sell off. In a bear market, it’s hard to really point out specific levels,” he said.

    “But at this index level, it will be a buying window for the long run,” del Castillo added.

    On Friday, the Philippine benchmark stock index recovered from its steepest dive this year on Tuesday and Thursday, as it regained 128.18 points, or 2.10 percent to 6,242.26.

    The wider all-shares index, on the other hand, also rose on Friday—adding 62.98 points to 3,897.76, or registering a 1.64-percent increase.

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