PH stocks facing big blockade at 6,900

Philippine stocks could see a pullback in the coming days after hitting a critical resistance zone.

“The local market may see more selling pressure emerge this week as it tries to surmount the 6,900 level. The base case is for the index to continue consolidating in the 6,750 to 6,950 area,” Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said over the weekend.

The benchmark Philippine Stock Exchange Index (PSEi) closed the past week higher by 0.34 percent to P6,873.23 as investors digested the continued pause in local interest rates and rising inflationary pressures in the US.

“Hotter than expected US January producer prices and a potential delay in US policy rate cuts may give investors reason to take profits. Nonetheless, resilient buying appetite could provide market support especially if we see sustained net foreign inflows,” Colet said.

“Traders will take their cue mainly from US and China markets for direction. The fourth quarter earnings release of AI (artificial intelligence) chipmaking giant Nvidia is also highly anticipated given its outsized contribution to the tech-fueled US rally,” he added.

In its latest edition of The Market Call, First Metro Investment Corp. and University of Asia and the Pacific said the PSEi could see a correction in the second quarter of 2024. It still maintained a positive outlook for the year.

“We also anticipate the PSEi to hit the 7,000 to 7,500 range within the year, following a period of correction in [the second quarter],” the report showed.

“Looking ahead, we maintain a positive outlook for the holdings, telcos, services, property and consumer sectors as PSEi gets an added boost from foreign investors,” it added. —Miguel R. Camus INQ