Local stocks are seen to trade with an upside bias this week, the first week of trading under the Lunar Year of the Metal Ox.
Last week, the Philippine Stock Exchange index (PSEi) shed 0.4 percent or 28.17 points to close on Thursday at 6,991.01.
The market had risen for five sessions before succumbing to profit-taking on Thursday ahead of the long weekend break. The market was closed on Friday due to the Lunar New Year holiday.Manny Cruz, chief strategist at Papa Securities, expects the market to remain upbeat this week given the resurgence of foreign buying in the previous week.
“Focus of interest in the near term will be on the fourth quarter 2020 corporate earnings reports that may indicate sequential recovery in earnings,” he said. The decision of monetary authorities to keep rates unchanged despite the inflation uptick was also welcomed by the market, he added.
Inflation in January moved at a faster pace of 4.2 percent, whereas the Bangko Sentral ng Pilipinas set the ceiling at 4 percent.
Cruz said the PSEi would likely trade between 6,700 and 7,170 this week.
BDO Unibank chief strategist Jonathan Ravelas said, “The week’s close at 6,991.01 signals the current rally remain fragile and susceptible to sell-offs.”
“This highlights the market is having difficulty to sustain itself above the 7,000 levels. Expect another attempt toward the 7,300 levels in the near-term. Failure to test said levels could see losses toward the 6,700 to 6,800 levels,” he added. INQ