Stocks seen to rise

THE LOCAL stock market is seen to sustain its upswing this week as the piercing of the 7,600 level last week has improved investors’ risk appetite.

During the four-day trading week last week, the Philippine Stock Exchange index (PSEi) gained 224.54 points or 3 percent to close at 7,617.13 on Thursday. The market was closed on Friday in observance of Eid’l Fitr or “Feast of Ramadan.”

Last week, Greece struck a new bailout deal with the European Union while China’s stock markets stabilized alongside measures taken by the government to boost liquidity and restore investor confidence.

“For technicals, the resistance at 7,600 was broken on Thursday following bullish news from China and Greece. Immediate resistance is now seen at 7,670, the high on June 1. A breakout from this resistance level will confirm the bullish reversal pattern with a technical price target of up to 8,000 points,” local stockbrokerage AB Capital Securities said in a research note.

Citing other technical indicators, AB Capital said the current uptrend was not yet “overbought,” thus suggesting that the run-up could extend up to this week.

“Investors turned bullish following positive China data and the resolution of the Greece debt crisis,” it said.

Last week, China reported a second-quarter gross domestic product (GDP) growth of 7 percent, slightly better than the market consensus forecast. Investors also welcomed upbeat manufacturing and retail sales data out of China.

Meanwhile, US Federal Reserve Chair Janet Yellen affirmed last week that the US central bank would raise interest rates this year if economic conditions remained on track. Doris Dumlao-Abadilla