Consolidation expected

Local stocks are seen to consolidate this week as investors await the US Federal Reserve policy meeting on Aug. 31 and the influx of local corporate earnings reports.

Last week, the main-share Philippine Stock Exchange index fell by 1.04 percent to close at 8,183.99.

Apart from profit-taking ahead of the US Federal Open Market Committee meeting on July 31, BDO Unibank chief strategist Jonathan Ravelas said market players were also awaiting local second quarter corporate earnings reports.

“The week’s close at 8,183.99 seems to be base-building consolidation as it gathers momentum to try the 8,500 levels in the near term,” Ravelas said.

The PSEi may trade within the range of 8,100 to 8,300 this week, said Joseph Roxas, president of Eagle Equities Inc.

The upside is seen to come from good earnings reports. Last week, for instance, BDO Unibank reported a first semester net profit growth of 54 percent year-on-year to P20.2 billion, accounting for 52.5 percent of BDO’s full-year bottomline goal of P38.5 billion and outperforming market consensus forecast. Despite this earnings surprise, however, shares of BDO were down by 2.44 percent on Friday in line with sluggish local and regional markets.

Jollibee is another stock to watch for and the market is still focused on it, Roxas said. —DORIS DUMLAO ABADILLA