Stocks seen trading in tight range | Inquirer Business

Stocks seen trading in tight range

By: - Business Features Editor / @philbizwatcher
/ 05:04 AM May 13, 2019

The local stock barometer is seen to continue trading in a tight range until fresh liquidity is injected to the financial system through a reduction in the bank reserve requirement.

But once the market gets some liquidity relief, the Philippine Stock Exchange index (PSEi) can recover to 8,400-8,600 level within this year, PNB Securities president Manny Lisbona said.

Last week, the PSEi fell by 2.83 percent to close on Friday at 7,742.20 as the country’s first-quarter gross domestic product (GDP) came in disappointing at 5.6 percent versus the market consensus of 6 percent.

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The market is on a holiday break today because of the mid-term elections.

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Lisbona said the market had moved sideways, or in a tight range, in the past few months.

“One reason for that is lack of liquidity; there’s a clamor for liquidity and if this liquidity is released, part of it will spur risk-taking and what’s the risk asset that can provide superior returns? That will be the equity market,” Lisbona said.

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Right now, Lisbona said the strategy should be to buy on dips and accumulate equities.

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TAGS: Business, stocks

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