Stocks seen to firm up
The local stock barometer is seen attempting to firm up closer to the 7,200 level this shortened trading week as the market enters the final stretch of 2014.
Last week, the main-share Philippine Stock Exchange index (PSEi) lost 98.58 points or 1.36 percent from the previous week although losses were pared in the last two trading days after the US Federal Reserve signaled patience over future interest rate increases.
Joseph Roxas, president of Eagle Equities Inc., said that in the last few days, the market was weighed down by selling orders from funds that were realigning their portfolio. “It seems that’s over and investors are now looking to reenter the market and take position for 2015,” he said.
At the same time, he said that the backdrop was favorable with the Dow Jones industrial index rising on Friday— even coming from a 400-point rally and heading toward the weekend. This meant that sentiment in Wall Street was strong, he said.
The Dow Jones index gained 26.65 points on Friday.
Jonathan Ravelas, chief strategist at Banco de Oro Unibank, said the volatility
in the local market tracked the movement in Wall Street.
“The index’ decline was attributed to the extreme drop in oil prices,” he said, noting that the US Fed’s vow to be patient on the timing of the first interest-rate increase had shored up sentiment on equities.
“Chartwise, we see the index ranging between the 7,000-7,200 levels in the last three trading days of the year,” Ravelas said.
“We are keeping our view that the index will close the year near the 7,000 levels,” he said.
This week, the market will trade for only two days in celebration of the Christmas season. Next week, the last trading week for 2014, there will be only one trading day (Dec. 29). Doris C. Dumlao
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