Share prices are expected to continue with their sideways movement this week as challenges both in the local and overseas continue to persist.
Papa Securities trader Gabriel Jose Perez said the market’s recent climb brought the index to overbought levels.
“With the index’s close of only a few points shy of the 7,400 level, we anticipate if it will continue its upward move next week. We therefore look forward to how US markets will perform and should also remain vigilant on further trade war developments,” Perez said.
“A caveat, in terms of technical analysis, momentum as shown by stochastics is already overbought,” he added.
BDO Unibank Inc. chief investment strategist Jonathan Ravelas said the market’s close at 7,399.18 last week signaled consolidation.
“The present bounce is likely not sustainable and remains vulnerable towards another attempt below the 7,000 levels,” Ravelas said.
Investors, however, are also expected to make gradual positions in oversold stocks with good fundamentals ahead of the release of the second-quarter earnings results.
The Philippine Stock Exchange Index last week rose 3 percent to close a point shy of the 7,400-point level, while the broader All Shares Index rose gained percent to 4,474.89.
All major sub-indices ended in the green, led by holding firms (+4.04 percent), financials (+3.04 percent), property (1.7 percent), mining and oil (+1.27 percent), services (+1.26 percent) and industrial (+1.12 percent).
Foreign investors were net sellers for the week by P1.62 billion, while the average daily value traded was flat at P4.9 billion.
Weekly top price gainers include Transpacific Broadband Group International Inc., which jumped 21.3 percent to P0.54; Bank of the Philippine Islands which advanced 9.7 percent to P96; and Cebu Air Inc., which climbed 7.5 percent to P71.
Weekly top price losers, meanwhile, were Concepcion Industrial Corp., which fell 9.7 percent to P53.95; DM Wenceslao & Associates Inc., which declined 8.1 percent to P9; and 2Go Group Inc., which dipped 4.8 percent to P14.42.
Meanwhile, Wall Street stocks finished modestly higher Friday, with the Nasdaq eking out a second straight record as beaten-down consumer stocks rallied.
The Dow Jones Industrial Average gained 0.4 percent to close the week at 24,019.41.
The broad-based S&P 500 advanced 0.1 percent to 2,801.31, while the tech-rich Nasdaq Composite Index added less than 0.1 percent to end at a new all-time high of 7,825.98.
Investors have turned their attention away from trade tensions for the time being to focus on corporate earnings, which are expected to rise by about 20 percent compared with the year-ago period.
Banks opened earnings season, with JPMorgan Chase and Citigroup both topping analyst expectations, while Wells Fargo fell short.
All three stocks retreated, with JPMorgan losing 0.5 percent, Citigroup 2.3 percent and Wells Fargo 1.3 percent.
Consumer staples, which has underperformed the broader market for much of 2018, was among the strongest sectors Friday. With AFP