Stock market holds tight as bears come out to play
The benchmark Philippine Stock Exchange Index (PSEi) would likely trade in a tight range of 7000 to 7,150 after a volatile week that saw it decline 1.47 percent.
The PSEi ended last week at 7,007.63 amid weak sentiments arising from a “combination of rising prices of commodities, a weaker peso and higher interest rates [that] will weaken earnings growth,” said BDO Unibank Inc. chief strategist Jonathan Ravelas.
“The week’s close at 7,007.63 highlights the bears are in control,” Ravelas said in a note to investors.
He said the key level to watch was the support level of 6,950. A breakdown could be followed by a drop to 6,500, or even 6,300.
Antonio Garcia, head of retail sales and online marketing at RCBC Securities, said investors could still find opportunities during times of crisis.
“A lot of it depends on one’s level of risk tolerance. If you can handle volatility, and we are seeing big swings almost on a daily basis, then you can take positions in specific stocks,” Garcia said during a recent forum organized by the lender.
“But any stock, whether defensive, dividend, blue chip, will still succumb to price drops if the market continues to drop. So my advice, if you’re buying, buy slowly and cautiously, as the market pulls back,” he added.
