Lackluster trading seen
Local stocks are seen to retest the 6,900 levels this week but may weaken with the end of semestral window-dressing and lack of fresh catalysts.
Last week, the Philippine Stock Exchange index (PSEi) went up by 111.19 points or 1.65 percent to close at 6,842.15 on Friday.
“We think the index will continue to experience weakness in the coming days as the MACD (moving average convergence-divergence) indicator still reads a negative divergence, which has been slowly approaching the zero line in the past few weeks,” said Joyce Ann Ramos, an analyst at local stockbrokerage AB Capital Securities.
“As long as this remains the case, the market may continue to consolidate while waiting for fresh leads that could help regain its momentum to retest new highs,” she said.
AB Capital sees the PSEi’s support and resistance levels at 6,625 and 6,900, respectively.
Among the notable overseas updates to be expected this week included China’s manufacturing index, US unemployment rate and Federal Reserve Chair Janet Yellen’s speech before the International Monetary Fund, Ramos said.
Locally, she said there would not be much economic updates to be expected except for the inflation rate report.
Jonathan Ravelas, chief strategist at BDO Unibank, noted that the PSEi managed to pierce through the 6,800 resistance level and retest the 6,900 level last week.
“However, profit-taking activities took place, putting credence to the 6,900 resistance,” he said. “Continue to expect the index to consolidate in the week ahead.” Doris C. Dumlao
