Anxious stock market starts week with Omicron posing a threat
A new coronavirus variant first detected in South Africa, considered a “variant of concern” by the World Health Organization (WHO), was expected to weigh on local equities this week after a global selloff on Friday.
“US markets and oil tumbled [Friday] night so there could still be continued selling when trading resumes,” Luis Gerardo Limlingan, managing director at Regina Capital Development, told the Inquirer.
The WHO said it was monitoring the variant, dubbed Omicron, given its large number of mutations that could make it more resistant to vaccines.
The benchmark Philippine Stock Exchange Index (PSEi) on Friday sank 1.23 percent to 7,278.44. The measure dropped 0.03 percent for the whole week.
BDO Unibank Inc. chief strategist Jonathan Ravelas said the key level to watch was 7,200 since a break below this threshold would signal a “near-term top was in place at 7,475.75 (Nov. 10 high) and may see further losses toward the 7,000 levels.”
For now, Ravelas expects the PSEi to consolidate within the 7,200 to 7,400 levels.
Limlingan said investors would also focus on the MSCI rebalancing ahead of the final implementation of changes on Nov. 30.
MSCI earlier announced it would add AC Energy Corp. and Monde Nissin Corp. to its MSCI Global Standard Indexes. For the MSCI Global Small Cap Indexes, it will add AREIT Inc., Filinvest REIT Corp. and LT Group Inc. and remove AC Energy and Double Dragon Properties.
