The stock market could see volatility this week but the overall outlook remains positive, analysts said, aided by strong fundamentals and optimism over the government’s tax reform plans.
“While we anticipate another volatile session given the tug-of-war between buyers and sellers, the overall backdrop is growth-affirmative, supporting valuations aided by strong fundamental angles,” 2TradeAsia said.
“Market participants will wait with bated breath legislators’ agreement on the final tax reform plan, which should bring about increased disposable income and savings,” it added.
“Sector beneficiaries include retail-related shares, banks and property.”
Lawmakers at the Senate have said that they are eyeing to pass their version of the Tax Reform for Acceleration and Inclusion Act (Train) before Congress takes a month-long break beginning this Friday.
Improved consumer spending could also encourage investments in listed firms, 2TradeAsia said.
“Timed with the Yuletide season, sentiment is bound to ride on improved liquidity, especially with the seasonal uptick in remittances. Increased loan take-up and/or higher fee-based receipts are in store for those engaged in the financial industry,” it said.
The government’s “Build, Build, Build” program, meanwhile, could boost conglomerates such as Ayala Corp., Metro Pacific Investments Corp. and San Miguel Corp.
Energy initiatives could also lead to gains for firms such as Manila Electric Company, AboitizPower Corp., and First Gen Corp.
The market’s immediate support was pegged at 8,300 while resistance is seen at 8,470.
Share prices returned to the 8,300 level on Friday, gaining 0.20 percent or 16.87 points to close at 8,310.88.
The wider All Shares grew 0.10 percent or 4.79 points to finish at 4,889.44.