Local stocks are again likely to trade sideways this week, with the prevailing bearish sentiment expected to continue.
The Philippine Stock Exchange index (PSEi) capped off a shortened trading week last Thursday in the red at 5,929.68, lower by 0.97 percent week-on-week.
The broader All Shares index was likewise down by 0.41 percent week-on-week at 3,593.28.
‘The PSEi will continue to be sideways in a narrow band, 5,900 to 6,000, due to the peso volatility and (US) Fed’s hawkish cut that is dollar supportive,’ First Metro Investment Corp. head of research Cristina Ulang said.
Philstocks Financial research manager Japhet Tantiangco said bearish sentiment continues to dominate the local market as downside risks continue to press on while positive catalysts are yet to be seen.
He said investor confidence also remains weak as seen on the anemic value turnover.
On the upside, Tantiangco said episodes of bargain hunting could be seen this week following two straight weeks of decline.
‘For the market’s general direction, however, we expect investors to take cues from our upcoming macroeconomic data. Investors are expected to look toward our third quarter GDP data to know how the local economy has been,’ Tantiangco said.
‘A growth slower than the government’s 5.5 to 6.5 percent target for the year may weigh on the market. Investors may also look at the upcoming S and P Global Philippines Manufacturing PMI and the country’s labor market data as these would also give clues on the strength of the local economy,’ he said.