Stocks are expected to move sideways this year, as investors will likely remain on the sidelines on mixed-earnings results.
Analysts said with the stronger-than-expected US jobs data, investors would likely remain tentative, as they waited for US Federal Reserve’s guidance on rate hikes.
The US Labor Department reported over the weekend that employers added 255,000 jobs in July, far more than investors expected. This marked the second straight month of strong jobs data.
Before the positive July jobs report, analysts were expecting the US Fed to leave rates unchanged, which would benefit emerging markets such as the Philippines in terms of portfolio inflows.
BDO Unibank Inc. chief investment strategist Jonathan Ravelas said the market continued to support a near-term high of 8,118.14, which was achieved on July 22.
“Look for a break below the 7,960 levels to support further test towards the 7,500 to 7,800 levels. Only a break above the 8,000 to 8,030 levels could signal a retest of the 8,100 levels,” Ravelas said.
The Philippine Stock Exchange index, the 30-company benchmark, closed flat in the first trading week of August at 7,970.35, while the boarder all-share index declined 0.2 percent to 4,740.95.
The sectoral indices closed mixed with holding firms, services and mining and oil posting weekly declines, and financials, industrial and property registering week-on-week gains.
Foreign investors were net buyers last week of P3.14 billion, as total foreign buying reached P20.8 billion while foreign selling amounted to P17.65 billion.
Average daily trading also dropped to P8.36 billion from last week’s average of P10 billion.
Top gainers last week were D&L Industries Inc. which climbed 6.1 percent to P10.54, Bank of the Philippine Islands which gained 5.5 percent to P101.30 and Cebu Air Inc. which jumped 5.5 percent to P115.
Stocks owned by embattled businessman Roberto Ongpin—PhilWeb Corp and Atok Big Wedge Co. Inc.–were among the heavy losers last week, declining by 46.4 percent and 15.2 percent, respectively.
Ongpin was named by President Rodrigo Duterte as one of the alleged oligarchs that his administration wanted to destroy. Ongpin resigned from his post as chairman and director of PhilWeb last week.