After staging a strong curtain-raiser for 2013, the main-share Philippine Stock Exchange index is seen to challenge the 6,000-mark even though it is expected to enter a consolidation phase.
In the first trading days of the year, the PSEi broke record levels for three straight sessions and gained 2.66 percent, closing last week at an all-time high of 5,971.45.
Global markets were upbeat over a budget deal that enabled the United States to steer clear of a “fiscal cliff,” brought on by a series of tax increases and budget cuts.
Ramon Garcia of RTG & CO. said the market’s move last week, confirmed his projection that the index would break 6,000 in January.
“This will happen this week. I am confident too (that) volume will continue to surge and reach new heights,” Garcia said.
Erico Claudio of Pentacapital Investments suggested that breaching the 6,000 level was a foregone conclusion. However, he said, indicators pointed to a consolidation, or a sideways movement this week. This means the PSEi may move by more or less 1.5 percent.
“I don’t think there’s a major correction yet. But there are many factors preventing another massive or 3-5 percent rise,” Claudio said.
For instance, Claudio said, Wall Street is seeing some correction after digesting the recent US budget deal.
“The celebratory impact will diminish, which means it will either push index down or make it consolidate,” he explained.
But neither is there any big catalyst for a major correction. “There are no indications yet on earnings results. People usually will have an idea by the second half of the month,” Claudio said.—Doris C. Dumlao