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BARGAIN SEEKERS could assist boost Philippine equities this week, with the publication of significant economic data, such as statistics on October inflation and third-quarter gross domestic product (GDP), to influence trading.
On Oct. 30, the benchmark Philippine Stock Exchange index (PSEi) decreased by 0.57% or 34.09 points to conclude at 5,929.68, whereas the broader all shares index dipped by 0.33% or 11.93 points to finish at 3,593.28. Philippine financial markets were closed on Oct. 31 due to a holiday.
Week on week, the PSEi fell by 58.34 points from its close of 5,988.02 on Oct. 24.
The bellwether index was also lower for the month, decreasing by 23.78 points from its 5,953.46 finish on Sept. 30.
“The figures indicate that the local market has been pessimistic for October,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco stated in a Viber message. “Trading has been sluggish, with net value turnover averaging P4.90 billion daily for the month, below the year-to-date average of P5.85 billion. Foreigners have been net sellers this month, resulting in net outflows totaling P5.85 billion.”
“This can be mainly attributed to the adverse investor sentiment caused by the corruption issues related to infrastructure in the Philippines and their influence on the nation’s economic outlook. The peso’s depreciation against the US dollar has also contributed to the market’s weak performance in October,” he explained.
Regina Capital Development Corp. Head of Sales Luis A. Limlingan mentioned that the market demonstrated “some resilience” despite erratic trading last month, primarily supported by strong corporate results.
“The power and mining sectors stood out, with several notable stocks gaining traction due to recent earnings reports and project advancements amidst tariff increases and trade disruptions. The property sectors have seen some improvement on residential, retail, and leasing fronts, as well as a gradual uptick in international tourism rates,” he stated in a Viber message.
For this week, Mr. Tantiangco mentioned that bargain hunting following the market’s two-week downturn could elevate the PSEi.
“Regarding the market’s overall direction, however, we anticipate that investors will take cues from forthcoming macroeconomic data. Investors are likely to focus on our Q3 GDP data to assess the performance of the local economy. Growth slower than the government’s target of 5.5%-6.5% for the year may have a negative impact on the market,” he noted.
He added that statistics on inflation and manufacturing activities, along with the movements of the peso against the dollar, could also yield some insights.
“Pessimistic sentiment continues to prevail in the local market as downside risks persist while positive catalysts remain elusive. Investor confidence continues to be fragile.”
Mr. Tantiangco identified the PSEi’s key support at 5,800 and significant resistance at 6,000.
In the meantime, Mr. Limlingan indicated that the release of additional financial results from listed companies could also serve as catalysts. — Alexandria Grace C. Magno
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