November 18, 2024 | 12:00am
MANILA, Philippines — Investors will be on the lookout for fresh catalysts this week to potentially restore the market’s upward momentum after last week’s huge selloff.
Despite closing last Friday’s session in positive territory at 6,676.65, the benchmark Philippine Stock Exchange index plunged by 4.31 percent week-on-week.
Online brokerage firm 2TradeAsia.com said concerns over trade and global growth continued to weaken emerging markets in general.
“Markets have been strung tight since late October, exacerbated by the US elections and most recently, comments from the Fed,” it said.
Philstocks Financial research manager Japhet Tantiangco said the local market’s technicals continue to show a bearish bias with the bourse already falling for four straight weeks, the last one being the deepest so far.
Further, Tantiangco said the market has broken below multiple crucial lines and zones, with the last one being the 6,700 to 6,800 support range.
“The market’s four-week fall has brought it to even more attractive levels, opening the possibility of bargain hunting. However, if our current headwinds are still present, then the risk of another decline is still high,” he said.
Among these headwinds are the weakness of the local currency, the rise of long term local and US yields as well as concerns over the prospects of protectionist policies in the US and its impact on the global economy.
However, he said the sound third quarter and nine-month financial results of local companies may give the market support.
“This week, we expect the index to range between 6,500 and 6,700, in anticipation of fresh catalysts, including the release of Philippine inflation data for November on Dec. 5 and the FOMC meeting on Dec. 18, which will help determine the potential rate cut,” Unicapital head of research Wendy Estacio-Cruz said.
Immediate support is seen at 6,400 to 6,550 while resistance is at the 6,700 to 6,800 range.
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