LOCAL stocks are seen to move higher this week as investors pick up more clues on the next administration’s agenda for the next six years.
Last week, the Philippine Stock Exchange index (PSEi) surged 6.36 percent to close at 7,436.79 on Friday after the peaceful conduct of the May presidential elections and the unveiling of the economic agenda of presumptive President-elect Rodrigo Duterte.
“The good turnout in the elections eased local and foreign investors’ uncertainties. New directions of the new administration are slowly being communicated as well. However, valuation concerns remain, which could limit the market’s rise,” said Jonathan Ravelas, chief strategist at Banco de Oro Unibank.
Chartwise, Ravelas said the week’s close at 7,436.79 continued to suggest that the market still had some room to try the 7,600 to 7,800 levels in the near term.
Sagarika Chandra, associate director at Fitch Ratings, said last week that the global credit watchdog was not expecting the outcome of the elections to have any immediate impact on the Philippines’ investment grade rating (BBB-) or the positive outlook.
Fitch had said in April that it would wait and see whether the improvement in governance standards achieved under the administration of President Aquino could be sustained after the 2016 elections, in line with its rating sensitivities. “If that were to occur, it could be positive for ratings,” Chandra said. Doris Dumlao-Abadilla