Stocks are expected to move downhill this week, after President Rodrigo Duterte declared a “state of lawless violence” following a bombing that killed 14 people in Davao City Friday night.
Analysts said foreign selling would likely continue this week, with the declaration of “state of lawless violence” and as Duterte was set to leave for the Asean meeting in Laos.
The possibility of US rate hike before the end of the year could also be used as an excuse by investors to cash in on previous gains, analysts said.
The soft US jobs data for the month of August could cool market expectations on imminent Federal Reserve interest rate hike.
The US economy added 151,000 jobs in August, a decent increase but less than 275,000 new jobs in July. Unemployment rate remained at 4.9 percent.
BDO Unibank chief investment strategist Jonathan Ravelas said despite current market conditions, the 30-company benchmark Philippine Stock Exchange index could still hit 8,000 level this year.
Ravelas said while the market had strong support on the 7,800-point level, a near-term bias remained for further weakness towards the 7,500 level.
The PSEi slipped 0.7 percent over last week’s five-day market trading to close at 78,07.42, while the broader all-share index dropped 0.9 percent to 4,629.86 as offshore funds’ exit intensified.
Except for the property sub-index which advanced 0.3 percent, all other major sub-indices ended in the red, led by services which dropped 1.9 percent, holding firms which retreated 0.6 percent and financials which declined 0.4 percent.
Foreign investors were net sellers last week of P7.54 billion, as total foreign selling hit P26.22 billion while foreign buying amounted to only P18.68 billon.
Top gainer was Medco Holdings Inc. which surged 51.2 percent to P1 on reports that Tiger Resort, Leisure & Entertainment Inc., the group led by Japanese billionaire Kazuo Okada, would use Medco for its backdoor listing.
Other major gainers were Manila Water Co. Inc. which climbed 4.3 percent to P27.90 and San Miguel Purefoods Company Inc. which jumped 4.1 percent to P224.
Heavy losers were Petron Corp. which dropped 9.6 percent to P9.92, Philippine Seven Corp. which went down 5.4 percent to P130 and Emperador Inc. which declined 4.5 percent to P7.60.