Share prices are expected to move sideways this week as the market continues to consolidate amid lack of leads.
Analysts said major contributors to the market’s recent rise, like the anticipated passage of the tax reform program, increase in government infrastructure spending and possible US rate hike, had all been factored. Investors are, thus, waiting for new catalysts that can push the market forward.
BDO Unibank chief investment strategist Jonathan Ravelas said the market could still try to make an attempt toward the 8,600-point level before the end of 2017 on renewed optimism that the upcoming passage of the tax reform bill would accelerate growth of the domestic economy.
“Chartwise, the week’s close at 8,365.11 highlights the market could still try another assault toward the 8,600 levels in the near-term. Immediate support and resistance is seen at 8,150 and 8,600 levels, respectively,” Ravelas said.
The seasonal increase in consumer spending during this holiday season could also boost consumer-related stocks, including energy and utilities.
Analysts said the market’s current sideways trading could provide opportunity for investors to accumulate on stocks that are expected to sustain their growth momentum in 2018.
“While we have seen how investors seize on intra-day strength to cash in from the local bourse’s ascent, this phenomenon is typical to a market poised in firming up a new solid base,” 2TradeAsia.com said.
The 30-company PSEi last week inched up 0.6 percent t 8,365.11, while the All Shares Index climbed 0.3 percent to 4,889.12.
Foreign investors were net sellers by P908 million, while the average daily value traded declined to P6.6 billion from the previous week’s average of P7.3 billion.
Weekly top price gainers were San Miguel Pure Foods Co. Inc., which rose 7.9 percent to P534; Bank of the Philippine Islands which advanced 6.5 percent to P103; and Robinsons Retail Holdings Inc., climbed 4.8 percent to P96.50 per share.
Weekly top price losers were Robinsons Land Corp., which declined 12.3 percent to P21 per share; EEI Corp., which dropped 9.6 percent to P11.20; and Globe Telecom Inc., which dipped 7 percent to P1,780.
US stocks, meanwhile, climbed to fresh records Friday on optimism about the holiday shopping season, while the euro surged following strong German economic data and on hopes that Europe’s biggest economy would soon resolve a political crisis.
Both the S&P 500 and Nasdaq ended at all-time highs, with the S&P 500 topping 2,600 points for the first time, amid forecasts that US holiday sales could jump by four percent or more compared with the year-ago period.
“Holiday retail sales in 2017 are expected to rise 4.2 percent above last year, which would be the strongest growth rate since 2014,” said a note this week from IHS Markit.
Some early data has already suggested an uptick in online sales compared with the year-ago period, but “the question is—and will remain throughout the holiday selling season—how much of the online sales strength will come at the expense of in-store sales?” said Briefing.com analyst Patrick O’Hare.