The local stock barometer is seen struggling to stay afloat 7,500 this week as investors remain cautious ahead of the US Federal Reserve meeting this week.
Last week, the Philippine Stock Exchange index (PSEi) ended lower by 28.03 points or 0.37 percent to close on Friday at 7,553.76. A big rally on Thursday was reversed by a big pullback on Friday.
“The market took back Thursday’s gains as more investors became jittery on the higher likelihood of a Fed rate hike by year’s end. Foreign net selling for the past four weeks has
amounted to P22 billion with the weakness in peso confirming the funds leaving the country,” said PNB Securities president Manuel Lisbona. “The market looks like it will break below 7,500 and test the 200-day moving average at 7,300 and hopefully find a base there.”
For BDO Unibank strategist Jonathan Ravelas, the week’s close at 7,553.76 suggested that the marketstill had room to test the 7,200 to 7,500 levels in the near term.
The US Federal Reserve Open Market Committee is set to meet this week (Sept. 20-21) to discuss the next course of monetary policy.
“Last Friday’s reversal gave us a clear indication that the corrective pressure on PSEi is still too strong that any rallies should be used to unload positions,” said Luis Gerardo Limlingan, managing director at Regina Capital Development. Doris Dumlao-Abadilla