August 26, 2024 | 12:00am
MANILA, Philippines — Share prices are expected to sustain an upward bias in another shortened trading week, a development that will see the local stock market back at the 7,000 level.
Last Thursday, the benchmark Philippine Stock Exchange index (PSEi) concluded a four-day trading week on a strong note at 6,961.96 following indications of a potential rate cut next month by the US Federal Reserve.
The PSEi has gained for the third straight week by 114.59 points or 1.7 percent.
Philstocks Financial research manager Japhet Tantiangco said while the local market managed to extend its rally last week, the bourse is still having a difficult time getting past its 7,000 resistance level.
“This week, the local market could still move with an upward bias,” Tantiangco said.
“The monetary policy easing cues from the Federal Reserve in the Jackson Hole Economic Symposium is expected to drive positive sentiment. This is as Fed rate cuts are seen to give more room to the Bangko Sentral ng Pilipinas to cut their policy rates too, thereby increasing the likelihood that they will continue with their monetary policy easing,” he said.
Tantiangco said the strengthening of the local currency, if it continues, is also expected to give the market a boost.
RCBC chief economist Michael Ricafort said the next target for the local bourse is the 7,000 psychological level, particularly the high of 7,070.72 posted on April 2, 2024.
“The underlying upward momentum for more than two weeks already remains intact for as long as it remains above the immediate support at 6,630 to 6,700 levels since reaching the immediate low of 6,397.10 posted on Aug. 5, 2024,” Ricafort said.
The PSE remains closed today, with trading set to resume tomorrow.
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