Stocks inclined to trade sideways

Share prices are expected to move sideways over the near term period with the earnings season coming to an end, as the market continues to monitor developments on the US-China trade negotiations.

Online brokerage firm 2TradeAsia said while the trade issue hangs, investors are looking for other catalysts that could push the market higher. 

“Apparently the ascent towards 8,200 was cut short after some fund managers seized on the rally to cash out. Viewed from this angle, the ascent would qualify more as a technical breather instead of fundamental shift said,” 2TradeAsia said.

“2020 will be a period of continued stimulus, both for monetary and fiscal policies, aligned to keep stable growth trajectory in place,” it added.

2TradeAsia said the aggressive 2020 budget planned by the Duterte administration could give the much needed boost to the market.

The Philippine Stock Exchange Index last week succumbed to profit taking, losing 1.6 percent to close at 7,932.96.

The broader All Shares Index also declined 1.5 percent to 4,793.96.

All sectoral indices ended in the negative territory, led by mining and oil (-3.85 percent), followed by industrial (-3.78 percent) and holding firms (-1.55 percent). Financials fell 1.3 percent while property and serviced dipped 1.3 percent and 0.3 percent, respectively.

Foreign investors were net sellers for the week by P2.43 billion, while the average daily value traded stood at P5.1 billion from the previous week’s average of P6.7 billion.

Weekly top price gainers were Alliance Global Group Inc., which rose 8.6 percent to P11.54, Bloomberry Resorts Corp., which advanced 4.8 percent to P11.38, and East West Banking Corp., which climbed 4 percent to P13.40.

Weekly top price losers were Jollibee Foods Corp., which fell 11.4 percent to P202, LT Group Inc., which dropped 7.9 percent to P11.98, and Aboitiz Power Corp., which lost 6.6 percent to P36.95.

Meanwhile, Wall Street’s faith in an imminent breakthrough in US-China trade talks sent stocks sailing to fresh all-time highs on Friday.

Stocks elsewhere mostly posted more modest gains, with London creeping forward despite a pledge from Britain’s opposition Labour Party to nationalize parts of telecoms giant BT and offer free broadband internet.

Though truces have broken and hopes have been dashed more than once before, positive signals from the White House helped all three major Wall Street indices set new records as the benchmark Dow Jones Industrial Average crossed the 28,000-point mark for the first time.

“The biggest driver to new highs was about trade, positive comments coming out of DC,” particularly remarks by top White House economic advisor Larry Kudlow on the possible signing of a US-China trade deal, Bill Lynch of Hindsale Associates told AFP. 

The two sides have made “enormous progress” on finalizing the partial deal President Donald Trump announced last month, Kudlow said late Thursday, adding to American officials’ positive signals in recent days.

In Britain, meanwhile, Labour  leader Jeremy Corbyn hit the campaign trail in the city of Lancaster in northwestern England, saying he would bring the parts of BT that deal with broadband into public ownership as part of a sweeping program of nationalizations. With AFP