Profit-taking seen this week
Local stocks are seen susceptible to profit-taking this week after eights weeks of consecutive climb.
Last week, the main-share Philippine Stock Exchange index rose by 0.6 percent to end at 7,773.45 on Friday on favorable local inflation prospects.
AB Capital Securities, in a research note, said in terms of technical readings, the index was once again trading nearing the psychological resistance at 7,800-level, opening it to profit-taking early this week.
The local stock brokerage said moving average convergence-divergence (MACD) and stochastics were also showing sell signals.
“As such, pullbacks can serve as accumulation points given an intact uptrend and strong local economic fundamentals,” the brokerage said.
AB Capital said index support for this week can be 7,600, while 7,800 may serve as the immediate resistance.
“The biggest catalyst for this week is the continuation of the Greek-Eurozone debt talks on Monday,” it added.
Last week, the Bangko Sentral ng Pilipinas (BSP) kept its interest rates unchanged as widely expected by the market. It, however, cut its inflation forecast for 2015 to 2.3 percent from 3 percent.
Banco de Oro Unibank chief strategist Jonathan Ravelas said the breaching of the 7,800 level last week was due to positive domestic earnings growth for the fourth quarter.
Chartwise, Ravelas said last Friday’s close would signal further tests of the 7,800-8,000 levels. Doris C. Dumlao