The benchmark Philippine Stock Exchange Index is expected to test the 7,500-point level this week on recovery hopes amid declining COVID-19 cases and easing of quarantine restrictions.
BDO Unibank Inc. chief investment strategist Jonathan Ravelas said the market’s rally has steam to try the 7,500 to 7,800 level over the near term period.
The market’s recent uptick, however, could trigger profit taking from investors and may push the index back to 7,350.
Analysts said investors are turning bullish after the government reported a better-than-expected 5.6-percent gross domestic product growth in 2021.
The inflation rate dropped to a 15-month low of 3 percent in January from 3.2 percent in December on slower increases in the prices of housing, water, electricity, gas and other fuels.
The PSEi last week surged 2.8 percent to 7,456.35 on improving economic data, falling COVID-19 cases and easing of mobility restrictions in the National Capital Region.
All six sectoral indices ended in the green led by property which advanced by 6.4 percent, mining and oil which was up by 3.6 percent and financials which climbed 2.5 percent.
Holding firms, industrial, and service also rose 2.4 percent, 2 percent and 0.5 percent, respectively.
Foreign investors were net buyers for the week by P1.28 billion. The average daily value traded reached P7.66 billion, up from previous week’s average of P6.6 billion.
Weekly top price gainers were Ayala Land Inc.., which advanced 8.5 percent to P37.10; Manila Electric Co., which increased 6.8 percent to P345; and Aboiiz Power Corp., which climbed 6.5 percent to P36.
Weekly top price losers were Converge Information and Communications Technology Solutions Inc. which declined 8 percent to P28; MREIT Inc., which dropped 5.9 percent to P21.25; and RL Commercial REIT Inc., which fell 4.8 percent to P8.4.
Global stocks, meanwhile, were mixed Friday as markets weighed a surprisingly good US jobs report against concerns over tightening monetary policy, while oil prices pushed closer to $100 a barrel.
The United States added an unexpectedly robust 467,000 jobs in January, according to Labor Department data that also significantly raised employment increases for November and December.
While the report suggests health in the world’s largest economy, another big rise in 10-year US Treasury note yields Friday focused concerns on expectations for multiple Federal Reserve interest rate hikes this year.
Worries about monetary tightening weighed on the Dow, while the S&P 500 and Nasdaq both finished higher.
All three major US indices finished the week in positive territory, with the S&P 500 winning 1.5 percent.
Earlier, European bourses had retreated a day after the European Central Bank opened the door to hiking interest rates in light of inflation.
Next week’s US consumer price index report could be another source of volatility, analysts warned.
“Persistent inflation, like a house fire, would force the Fed to barrel in and hose down inflation without regard for the upholstery, in this case equities,” said Jack Ablin, chief investment officer at Cresset Capital Management. With AFP