By Revin Mikhael D. Ochave, Reporter
PHILIPPINE shares are expected to be off a good start this trading week as investor sentiment got a boost from the central bank’s recent survey showing improving confidence of consumers and businesses despite the coronavirus disease 2019 (COVID-19) pandemic.
The bellwether Philippine Stock Exchange index (PSEi) closed Friday’s session at 7,246.16, higher by 91.73 points or 1.28% than the previous trading day.
Week on week, the main index improved 1.56% or 111 points, sustaining the upward trend it had in the last trading week.
The market’s average value turnover increased 14.1% week on week to P11.09 billion, while average net foreign selling eased 50.6% week on week to P290 million.
Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a mobile phone message that the market may have a good start this week as investors will absorb the recent survey of the Bangko Sentral ng Pilipinas (BSP).
The BSP on Friday released its latest survey, which showed that consumer sentiment improved to -47.9% in the current quarter against -54.5% in the third quarter due to hopes of a nearing end of the COVID-19 pandemic resulting from vaccine availability, additional employment, and higher income.
Meanwhile, business sentiment this quarter improved to 10.5% compared to -5.3% in the previous quarter, largely on the back of the ongoing recovery of the economy from the pandemic and more businesses resuming their operations.
Mr. Tantiangco said some of the key indicators that may sustain the market’s momentum include prospects of the availability of the COVID-19 vaccine in the country and improving economic numbers. However, he warned that the market may see some profit taking during the week and can be affected by a possible surge of local COVID-19 cases as Christmas nears.
“At its current level, the market is seen to be more susceptible to profit taking given that our economic and corporate fundamentals remain weighed by the damages left by the stringent quarantine measures previously implemented, the current ones in place, and ultimately, the pandemic,” Mr. Tantiangco said.
Meanwhile, online brokerage 2TradeAsia.com said in a market note that the local bourse will be affected by the upcoming meeting of the Federal Open Market Committee this week.
2TradeAsia estimated that the market’s immediate support will be at 7,000, while its resistance will range from 7,300 to 7,450.
“This week, we may see the market test the validity of its current level. If the market sustains its ground at the 7,150 line, its new trading range is seen from 7,150 to 7,500. Failure to hold ground at the said level however would lead to a return to its 6,600 to 7,150 trading range,” Mr. Tantiangco said.