PHILIPPINE EQUITIES may stay subdued this week as investor sentiment remains wary, with US President-elect Donald J. Trump poised to assume office on Monday and in light of the lack of new catalysts.
On Friday, the main Philippine Stock Exchange index (PSEi) climbed by 1.38% or 86.60 points to 6,352.12, while the broader all shares index rose by 0.76% or 27.95 points to 3,703.73.
Nonetheless, week-over-week, the PSEi decreased by 2.22% or 144.20 points from its close of 6,496.32 on Jan. 10, marking its second consecutive weekly drop.
“Domestic stocks mirrored regional counterparts, succumbing to profit-taking ahead of Mr. Trump’s inauguration. Volatile global capital markets were affected by economic and political apprehensions,” online brokerage 2TradeAsia.com noted in a market commentary. “In addition to uncertainties regarding trade, immigration, and taxation, signs of distress in the overall US economy are impacting global conditions.”
“The domestic market has become increasingly pessimistic as it continued its drop. Concurrently, the market has slipped below the 6,400 mark, which had previously functioned as a support level,” stated Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco in a Viber message.
During the week, the benchmark index dipped to the 6,200 threshold twice as the publication of critical US inflation data prompted markets to adjust their expectations regarding the Federal Reserve’s policy easing.
On Thursday, the PSEi plummeted to 6,265.52, marking its lowest close in almost seven months, since it finished at 6,158.48 on June 21, 2024.
Looking to this week, Mr. Trump’s inauguration is expected to be a significant source of direction for the market, according to Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort in a Viber message.
“We anticipate the cautious mood to persist in the local stock market due to the absence of new leads. Investors are likely to await new catalysts. Until then, signals are expected to be derived from other financial markets,” Mr. Tantiangco mentioned.
“We might also witness instances of bargain hunting since the local market remains at appealing levels, from a fundamental perspective,” he added, establishing the PSEi’s support at 6,150 and resistance at 6,400.
For its part, 2TradeAsia.com set the market’s support at 6,000 and resistance at 6,500.
Mr. Trump arrived in the Washington area on Saturday evening to commemorate his return to power, according to Reuters.
In the Capitol Rotunda, Mr. Trump will be inaugurated at 12 p.m. ET (1700 GMT) and subsequently deliver an inaugural address, a speech that typically establishes the tone for the president’s four-year term. He informed NBC News that the theme would encompass “unity and strength, along with the notion of ‘fairness.’”
As he returns to the White House on Monday afternoon, Mr. Trump is anticipated to commence signing numerous executive orders and directives aimed at tightening immigration, enhancing US energy production, and other priorities. — Revin Mikhael D. Ochave with Reuters
