Stocks are expected to move sideways in the first trading week of 2016, as investors look overseas for direction in the absence of developments in the domestic market.
Regina Capital Development Corp managing director Luis Limlingan said the 30-company Philippine Stock Exchange index was expected to struggle below the 7,000-point level.
“Unless the prices break the 50- and 100-day moving average resistance points, we are looking at a sideways to down trade for the next two weeks,” Limlingan said.
Analysts, however, remain bullish on the domestic economy, given the upcoming elections which are expected to boost spending.
“In 2016, we expect the election season to spur spending and boost corporate earnings. While low commodity prices are seen to persist, the low oil prices might translate to increased consumption. US Fed rate increases will also cause volatility but the sound Philippine economic fundamentals will support the market along the way,” RCBC Securities analyst Ralph Christian Bodollo said.
The PSEi settled at 6,952. 08 in the last trading week of 2015, down 50 points or 0.7 percent from previous week’s close, after the expected year-end window-dressing failed to lift the market
The PSEi lost 3.9 percent year-on-year in 2015, dragged down by weak commodity prices, China’s economic slowdown and the US Fed interest rate hike.
Foreign investors were net sellers by P59.71 billion in 2015, as total foreign selling reached P1.061 trillion while foreign buying amounted to P1.001 trillion.
Total market capitalization reached P13.465 trillion as of end-2015.
Top gainers last week were Travellers International Hotel Group Inc.. which jumped 29.4 percent to P4.40; Benguet Corp. “A” shares which climbed 22.2 percent to P5.50; and Cebu Property Venture and Development Corp., which rose 19.7 percent to P6.
Heavy losers last week were IP E-Game Ventures Inc., which fell 46 percent to P0.0053; Manila Mining Corp. “A” shares which dipped 9.09 percent to P0.010; and Now Corp., which shed 7.4 percent to P0.75.