Vigorous consumer spending may yet help spur stock market
The benchmark Philippine Stock Exchange Index (PSEi) would continue to consolidate within the 7,200 to 7,400 levels in the near-term, said Jonathan Ravelas, chief equity strategist of BDO Unibank Inc.
The PSEi dropped 1.39 percent week-on-week as investors continued to absorb the results of late third quarter earnings reports while renewed inflationary risks weighed on economic recovery prospects around the world.
The Bangko Sentral ng Pilipinas kept the key interest rate unchanged at its record low of 2 percent as Governor Benjamin Diokno said inflation remained manageable.
Ravelas said the previous week’s close was a warning the market had trouble sustaining gains above 7,350 to 7,425.
He added a break below 7,200 would signal a “near-term top” at 7,474.75 was in place, with the downside risk seen to extend to 7,000.
Meanwhile, strong consumer spending in the fourth quarter earnings season could act as a catalyst for the market to move higher.
“The fourth quarter should be good for earnings. Hopefully, we get some catch up in earnings from the property sector, most of them were lagging in the past three quarters,” Mark Angeles, head of equity research at First Metro Securities Brokerage Corp., said during a business forum organized by the Inquirer.
“So, we’re more focused on the reopening [of the economy], people are going out to spend,” he said. INQ
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.