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Stock index likely to stay above 8,000

The Philippine Stock Exchange index, the 30-company benchmark, is likely to firm up above the 8,000-point level on benign inflation outlook and expectations of another round of interest rate cuts.

AAA Securities research head Chris Mangun said the PSEi had steadily climbed over the last eight weeks and, “we finally might have a shot at breaking that heavy resistance at 8,150”.

“If it can successfully break above that resistance level, then we may see it back at all-time highs before the end of the year. This scenario may play out over the next few weeks. However, if it fails to rally, then we will see it lose another 500 to 600 points and trade sideways till the end of the year,” Mangun said.

“I am more inclined to believe that the former scenario is what will play out. The next few weeks are going to be interesting,” he said.

The bellwether rose 1.48 percent last week to close at 8,117.94 on July 5, while the broader all-share index climbed 1.06 percent to 4,945.68 amid thin trading.

“The week’s close at 8,117.94 momentum is building up to challenge the 8,100/8,200 levels. A break above 8,200 could signal a break-out of the 7,500 to 8,000 levels consolidation and engage the bulls back to play,” BDO Unibank chief investment strategist Jonathan Ravelas said.

Four of the six sub-indices posted week-on-week gains led by property which advanced 2.48 percent, industrial which climbed 2.45 percent, financials which rose 1.27 percent and holding firms which went up 1.22 percent.

Mining and oil index declined by 2 percent while services lost 0.72 percent on a week-on-week basis.

Foreign investors were net sellers last week by P357.7 million, while the average daily turnover dropped to P5.8 billion from the previous week’s average of P10.3 billion.

Top gainers last week were Philippine National Bank which jumped 14.1 percent to P0.97, First Philippine Holdings Inc. which rose 13.5 percent to P91.65 and Aboitiz Power Corp. which advanced 6.3 percent to P37.

Heavy losers included Phinma Energy Corp. which retreated 13.7 percent to P2.20, Ginebra San Miguel Inc. which dropped 9.6 percent to P57.40 and Megawide Construction Corp. which slipped 5.3 percent to P18.

Topics: Stock Market , Philippine Stock Exchange Index , Philippine Stock Exchange , PSE , PSEi
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