Philippine stocks seen to rise

A+
A
A-

The local stock index may retest recent record highs past 7,100 this week on the back of upbeat first-quarter corporate earnings reports, month-end window-dressing and record-low interest rates.

Last week, the Philippine Stock Exchange index gained 0.98 percent to close at 7,025.44 on Friday. The index is nearing the all-time peak of 7,120.48 seen last April 22.

Joseph Roxas, president of Eagle Equities, said the market has the strength to revisit all-time highs this week. It was even possible that it might be breached, he added.

“Chartwise, continue to see the market to range between the 6,750-7,300 levels in the week ahead,” said Jonathan Ravelas, chief strategist at Banco de Oro Unibank. “However, profit-taking activities near the recent tops could occur.”

The fresh 25-basis-point rate cut sanctioned by the Bangko Sentral ng Pilipinas in its special deposit accounts (SDAs) is also seen boosting risk appetite. Even if just a small portion of funds currently locked up in SDAs shift to equities, fund managers said the impact would be significant. More than P1.9 trillion in excess funds is currently locked up in these SDAs.

Dealers said that while local valuations have been stretched out, liquidity has been driving prices even higher.

On Friday, the Dow Jones industrial index was marginally higher (+11.75 points or 0.08 percent) after a weaker-than-expected 2.5-percent growth in the US economy in the first quarter, slower than the expected pace of 3 percent, raising concerns on how the world’s biggest economy could cope with spending cuts and higher taxes.—Doris C. Dumlao

Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.

To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.

Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:

c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City,Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94

editors' picks

advertisement
advertisement