Stocks may eke out gains on last trading days
Local shares are expected to eke out gains during the last trading week of 2011, allowing the main stock market index to close higher for the third straight year.
Last week, the main-index crept 67.3 points, or 1.56 percent, higher to finish at 4,372.24.
Paul Joseph Garcia of Bank of the Philippine Islands said the index would target 4,400 to 4,500 this week.
The index ended 2010 at around 4,200.
“This is part of window-dressing toward yearend,” Garcia said. “We’re now seeing the Santa Claus rally, so just ride it.”
Garcia said that, although it would be difficult to mark new highs in the last days of the year, he could still expect investors “to take advantage of this uptick in share prices.”
The fund manager said half of the market trades these days now consist of transactions by foreign investors, compared with the 65-35 percent share favoring domestic investors for most of the year.
“After the MSCI rebalancing last December, we’ve seen an increase in foreign participation,” Garcia said, adding that foreign sentiment was further boosted by the “positive” credit watch placed by Standard & Poor’s on Philippine sovereign credit.
AB Capital Securities, in its weekly note, said the market would most likely tread sideways on very little leads this week.
“Investors will remain non-committal due to the prevailing worries on Europe. They remain hopeful that the domestic economy through the efforts of the Aquino government will be able to attract investors to the Philippines,” AB Capital Securities said.
“Moreover, the slow recovery of the US economy is showing that not everything is negative in the world. For now, we are recommending taking positions in the sun rise and defensive sectors like gaming, resources and utilities,” the brokerage said.
Trading range is seen by AB Capital between 4,250 and 4,400.—Doris C. Dumlao
