Volatile trading seen

THE BENCHMARK Philippine Stock Exchange index (PSEi) ended 1.3-percent lower week-on-week on what was generally an uneventful period.

The coming trading days could see some drivers from overseas developments and from companies disclosing corporate developments and first-quarter results, an analyst said. Moreover, risk aversion could settle in toward the end of the week ahead of the elections on May 9.

The PSEi ended Friday lower by 0.05 percent, or 3.27 points, to 7,159.29, compared to the previous trading day.

Some of the companies expected to disclose first-quarter results this week are Philippine Long Distance Telephone Co., Holcim Philippines and D&L Industries. Annual meetings by Metro Retail Stores Group, China Banking Corp. and Philippine Stock Exchange Inc. have also been set this week.

Joylin Telagen, head of research at I.B. Gimenez Securities Inc., said the PSEi would likely trade “sideways with a downward bias” this week.

“Early Monday, investors’ sentiment will be driven by manufacturing data from China and the results of companies’ Q1 earnings,” she said.

She said the end of the week could see investors taking a more cautious approach due to US nonfarm payrolls and the Philippine elections on May 9, which is a Monday.

Meanwhile, growth prospects were unlikely to be affected by the country’s next leader because of the Philippines’ “good” macroeconomic fundamentals, she said.

“Reforms will not be easily reversed,” she said, noting that a clear and decisive winner should nevertheless emerge.

“If there’s a clear winner, the PSEi will bounce back but if there’s a contested result, expect more investors to sell off until resolved,” Telagen said.

Meanwhile, technical indicators showed that the PSEi would trade within the 7,000-7,200 range, she said. For his part, BDO Unibank chief strategist Jonathan Ravelas said on his Twitter account Friday that the PSEi might still test the 7,000 level, with any upside limited to 7,250. Miguel R. Camus