Cautious trading to continue

Investors would likely stay cautious ahead of the resumption of trading tomorrow as external factors weigh on stock market sentiments at home, an analyst said.

Philippine financial markets are on break until today due to the Asia-Pacific Economic Cooperation (Apec) Leaders’ Summit in Manila.

Even with a two-day break from trading, Astro Del Castillo, First Grade Finance Inc. managing director, said investors might choose to stay on the sidelines on Friday.

“The jitters are still there,” Del Castillo said. “There’s still concern on the [United States] Federal Reserve increasing interest rates and the global [economic] slowdown.”

Earlier in the week, analysts also blamed the market’s decline on the brutal terrorist attacks that hit Paris, France, last Friday, causing investors around the world to dump risky assets like stocks.

Nevertheless, Del Castillo said the current Philippine Stock Exchange index (PSEi) valuation was already “attractive” enough for investors to start accumulating, but he did not rule out the possibility that domestic equities could move lower.

“Cautiousness is still in the air,” he said.

Del Castillo said the PSEi would trade between the 6,700 and 6,900 range in the near-term. “Investors would trade in that range until all the dust settles,” he said.

On Tuesday, the PSEi posted its first gain after a nine-day losing streak. The PSEi gained 0.78 percent, or 52.46 points, to 6,825.38 while the broader All-Shares index was up 0.84 percent, or 33.01 points, to 3,947.44.  Miguel R. Camus