The benchmark Philippine Stock Exchange index (PSEi) managed to end in the green on Tuesday after declining in the past few trading days, albeit still at 6,400 level, with the investors taking advantage of oversold shares.
PSEi inched up 0.12 percent, or 7.52 points, to close at 6,474.53 while the broader all-shares index fell 0.11 percent, or 3.88 points, to sit at 3,471.05 by the closing bell.
“Investors finally became bargain hunters after witnessing an intense equity sell off Monday night with the S&P 500 (-3.88 percent) tumbling to a fresh low for the year and closing in bear market territory as recession fears grew ahead of this week’s key [Federal Reserve] two-day policy meeting,” Regina Capital Development Corp. head of sales Luis Limlingan said.
The US market’s plunge might stoke fears that PSEi would follow suit and enter the bear market as well, but Limingan said it was hard to tell for now. “No one has definite reading,” Limlingan said. “I think we have to just keep looking at data day-to-day.”
Philstocks Financial Inc. senior research analyst Japhet Louis Tantiangco, meanwhile, offered a more optimistic outlook: “For now, we don’t see the market reaching bear market territory.”
Tantiangco noted that PSEi was only down 14.27 percent from its recent high of 7,552.20 on Feb. 9. A bear market occurs when share prices plunge by 20 percent from their recent highs. He explained that the 6,350-6,400 support level remains intact. PSEi has to decline to 6,041.76 before slipping into bear market territory, he added.
“From a fundamental standpoint, despite the lingering challenges, the economy is still seen to grow strong this year, and this is providing support to the market,” Tantiangco said.