PHILIPPINE shares may experience some buying pressure this week as fund managers rebalance and window-dress their portfolios as the quarter draws to a close. It remains to be seen if the pressure is enough to boost prices in the absence of lack of real market-lifting catalysts, analysts said.
“As to how the market fared during the first quarter of the year will be highlighted this week. For most of March, we saw the local benchmark trading from 7,150 to 7,400, a continuation of the sideways trend made in the first two months of the year,” online brokerage firm 2TradeAsia.com said.
“Nonetheless, there might be some window dressing in the final week of March, as fund managers rebalance their holdings ahead of their quarter-end review,” it added.
Window dressing is an accounting approach used by fund managers near the end of a year or quarter to improve the appearance of portfolio performance before presenting it to clients or shareholders.
Investors are also set to watch out for the listing day performance of Wilcon Depot Inc.’s P7.9-billion initial public offering (IPO) on Friday.
Investors and fund managers will also track how the trade negotiations between the UK and European Union will pan in light of the Brexit move last year, as well as the geopolitical tension from North Korea’s unabated missile test launches and the impeachment of South Korea’s Park Geun-hye, 2TradeAsia.com said.
“Any motion to move the scale on clearer economic directions could provide guidance for fund flow, including prospects for direct investments. For now, it would be prudent to maintain a defensive stance, as markets are still waiting for key macro catalysts. Part of the limelight might also shift on the listing of Wilcon,” the online brokerage said.
Jeremy Yumul of RCBC Securities said they “expect local shares to continue to be influenced by the movement on Wall Street while investors keep an eye out for the remaining companies that have yet to release full-year 2016 figures.”
On Friday, the benchmark PSEi declined by 0.43 percent or 31.41 points to 7,269.62, while the wider All Shares decreased by 0.23 percent or 9.93 points to 4,376.74.