Local stock trades are seen to thin out further this week as the nation observes the Holy Week, but some investors may opt to pocket gains before the long weekend break.
Last week, the main-share Philippine Stock Exchange index (PSEi) rose by 1.53 percent to close on Friday at 5,346.97. There are only three days of trading this week as Maundy Thursday/ “Araw ng Kagitingan” (Day of Valor) and Good Friday are nonworking holidays.
Investor confidence is slowly returning after the government announced concrete measures that would help soften the impact of the pandemic and the Luzon lockdown, said BDO chief strategist Jonathan Ravelas said.
“The week’s close at 5,346.97 highlights the bounce has still some room to try 5,500 to 5,800 levels in the near-term. Expect some profit-taking as we near said levels,” Ravelas said.
President Duterte recently signed into law Republic Act No. 11469 or the Bayanihan to Heal as One Act, which granted special powers in addressing the coronavirus disease (COVID-19) public health crisis. The law mandates a social amelioration program that provides for an emergency subsidy of P5,000 to P8,000 to 18 million low-income households all over the country.
Uncertainties remain, however, on whether the monthlong lockdown of Luzon—which is now entering its fourth week—would be extended to ensure that COVID-19 infection would subside.
“The market continues to be buffeted by headwinds brought about by the COVID-19 pandemic, albeit not as wildly as last month,” said PNB Securities president Manuel Lisbona.
Chartwise, Lisbona said the market seemed to be taking a pause after a strong but short-lived run on the back of the US Federal Reserves “QE (quantitative easing) Infinity” stimulus package.
“This week also saw the market hit resistance at 5,400, which is about 50 percent of the distance between the 2009 low and 2018 all-time high,” Lisbona said. INQ