Markets on holiday break
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The local stock market is on holiday break today in commemoration of National Heroes Day. This means the local market will again miss out on the action in
Asian emerging markets, which are still out of flavor among global funds.
In the near term, market players are still bracing for a further shakeout. Through next month when the US Federal Reserve is widely expected to start its tapering of aggressive bond buying, many expect the local index to retest the year’s lows seen in June, when local equities knocked on bear territory.
“Chart-wise, the index tested the 6,000 level and fell below the 200-day moving average. A break below 6,000 may signal further losses toward the 5,650-5,800 levels,” said Banco de Oro Unibank chief strategist Jonathan Ravelas.
The Philippine Stock Exchange index lost 364.74 points or 5.59 percent during last week’s two days of trade as markets were disrupted by inclement weather.
Local bonds and the peso likewise weakened last week alongside the shakeout in the capital markets.
The normalization of global monetary policy could lead to a sharp outflow of capital from the Asia-Pacific region, triggering higher financing costs and exchange rate volatility, Standard & Poor’s Ratings Services said in a new report last week. Doris C. Dumlao
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