Party at the stock market: Foreign flows welcome

Stocks may extend their winning streak this week as foreign investors regain confidence in the market especially now that the economy is being opened up to more businesses.

Last week, the main-share Philippine Stock Exchange index (PSEi) racked up a total of 585.59 points or 9.9 percent to close Friday at 6,484.06, marking its best performance in about five months.

In the last three sessions, foreign investors trickled back to the local market, ending 28 days of net foreign selling.

“The reentry of foreign flows might serve to push market up further. We’re looking at 6,700 as first resistance,” PNB Securities president Manuel Lisbona said.

Since the start of the year, foreigners have so far dumped about P115 billion worth of local equities.

“So if they do come and buy back, what a rally that would be!” Lisbona said. “The phased reopening of certain sectors, like hotels, sends a positive message but we need to see if [coronavirus] cases spike up because of it.”

Investors will also be on the lookout for the listing of fiber internet and digital service provider Converge ICT Solutions Inc. following the completion of its P29-billion initial public offering.

“I think the attention will be on Converge,” Roxas said.

On the main stock barometer, Roxas said the party could enter the second week.

If foreign flows would continue to come in, he said the PSEi could next target 6,600. He expects the PSEi to find support at 6,200.

Meanwhile, investors are also expected to pore over third quarter local corporate earnings with the reporting season having just begun. —DORIS DUMLAO- ABADILLA INQ