SHARES OUTLOOK FOR THE WEEK:

Taking positions for inflation data, SONA

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The Philippine stock market is seen building a stronger base for another rally soon, which traders said would provide a good chance for investors to pick up the recent laggards that may yet benefit from their company’s expanded capital expenditure plans.

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Fresh catalysts for the market could come from the official inflation data due out this week and President Rodrigo’s state of the nation address (SONA) later this month.

“Expect some consolidation for now as the market builds its base to support stronger rises,” online brokerage firm 2TradeAsia said in a market note.

“This will be a good time to revisit specific stocks that have lagged for quite some time (e.g., telecommunications, mining, water), especially those that would benefit from improved capital expenditure or investment initiatives,” it added.

Joseph Roxas, president of Eagle Equities Inc., sees the market trading a bit higher this year as investors take positions for the upcoming second SONA of President Duterte within the next three weeks.

Regina Capital Corp. Managing Director Luis Limlingan said the Philippine market will be looking at the inflation rate for June, the consensus for which stands at 2.7 percent, lower than the previous month’s 2.9 percent.

“To review, the Bangko Sentral ng Pilipinas recently reduced the inflation outlook for the entire year from 3.4 percent to 3.1 percent,” Limlingan said.

2TradeAsia, meanwhile, said the expectations for inflation are for slower increases in consumer prices for June, mainly driven by the latest weakness in crude prices.

The market’s immediate support is seen at 7,800, while resistance is at 7,950.

On Friday, the bellwether index closed up 0.71 percent, recovering 55.10 points to close at 7,843.16. The broader All Shares inched up 0.63 percent or 29.38 points to 4,692.03.

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