Local stocks are seen to continuing to trade with caution this week as investors await fresh incentives.
Last week, the Philippine Stock Exchange index (PSEi) lost 144.88 points or 1.68 percent to close at 8,467.56 on Friday. It was the first trading week of the new lunar year of the dog.
BDO Unibank chief strategist Jonathan Ravelas said investors had remained on the sidelines “as they have yet to get comfortable with the higher interest rates and higher inflation. They are also awaiting fresh leads from the economy and markets to justify accumulation of stocks.”
He said the week’s close at 8,467.56 suggested that the market would range from 8,350 to 8,700 in the near term. Immediate support and resistance are seen at 8,350 and 8,800 levels, respectively.
Christopher Mangun, head of research at Eagle Equities Inc., said that while the market had broken the 8,500 support level on Friday, the PSEi would likely continue trading sideways in the following weeks between 8,420 and 8,700.
“If we do break below 8,420, then we may see it go all the way down and test support at 8,330,” Mangun said.
“Building a base at these levels is important for the market before we can try and test the 9,000 level. In the meantime, we will continue to see more action in second-liners and speculative stocks,” as we wait out the foreign selling,” he said.