Cautious trading to continue
Stocks ended lower last week and market observers said investors would remain cautious with the lack of major domestic driver this week and as the third-quarter earnings season winds down.
The benchmark Philippine Stock Exchange index (PSEi) closed the week down 0.14 percent, or 8.78 points, to 6,346.40. It sank to almost 6,200 earlier last week as the country dealt with the immediate aftermath of Supertyphoon “Yolanda,” which devastated parts of Visayas and killed thousands.
Indications from the US Federal Reserve that it would continue to support stimulus measures helped prop up markets but trading would likely remain sideways in the coming weeks, said Joseph Roxas, president of stock brokerage firm Eagle Equities Inc.
“Prices may creep up slowly toward the end of the year, but I don’t see any big surge until it’s window-dressing time,” Roxas said in an interview.
Details from a US Fed could also help shape the market’s direction, stockbrokerage firm AB Capital Securities Inc. said in its weekly outlook report. “Following the US Senate’s confirmation hearing on Yellen as the next Fed chair, incumbent Ben Bernanke is next to speak as [FOMC’s] minutes for the month of October will be disclosed this week,” AB Capital said.
“Held eight times in a year, the seventh FOMC should either dispel the speculative early tapering by December and/or provide a timetable before Bernanke steps down in January next year,” it added.
AB Capital noted that stock movement last week remained cautious as corporate earnings were generally slower in the third quarter.
“Last week’s trade established the sideways trading range between 6,200 and 6,650. With technical indicators at their oversold levels, the PSEi could make a comeback to 6,400 but external factors will still weigh, particularly the upcoming FOMC minutes,” AB Capital said.
It noted that the immediate support was pegged at 6,300 and resistance at 6,500.
Overseas indicators that investors would monitor include the US Consumer Price Index for the month of October and the weekly round of jobless claims, it added.—Miguel R. Camus
