PSEi to hit 7,650 this year?

The stock barometer may recover to at least 7,650 this year on the back of improving corporate earnings while the vaccine rollout and the reopening of the economy can even offer further upside, according to Sun Life of Canada Philippines.This represents an increase of 975.49 points or 14.6 percent from last week’s closing of 6,674.51.

Last week alone, the Philippine Stock Exchange index (PSEi) recouped a total of 475.26 points or 7.7 percent as the latest MSCI rebalancing adjustments ended while bargain-hunting emerged.

In a briefing last week, Sun Life of Canada Philippines chief investment officer Michael Gerard Enriquez said it could take the country two years to return to its prepandemic economic growth path.

Enriquez also noted the local stock market has been the worst performing in the world, the biggest cause of which was foreign selling which amounted to $1.3 billion in the first five months of the year. “But the good thing is we have seen value emerge in PSEi,” Enriquez said.

Sun Life’s house view of an upside in the PSEi towards 7,650 assumes that earnings per share will rebound by 60 percent this year.

“We’re more confident if government can really deliver the vaccine supply and roll it out effectively and efficiently … From where we sit now, 7,650 is doable,” Enriquez said. INQ