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Sunday, May 19, 2024

Stock index seen testing 7,000 level on sustained rally

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Philippine stocks may attempt to breach the 7,000 level this week amid the global market rally.

Rizal Commercial Banking Corp. head economist Michael Ricafort said the mostly better-than-expected US economic data could support better market valuations.

“Market sentiment is partly supported recently by the record highs in stock markets in the US and in other parts of the world,” Ricafort said.

The bellwether Philippine Stock Exchange index (PSEi) hit an intra-day high of 6,990.65 last week, before closing at 6,913.21, up 0.58 percent from previous week’s close. The market was also up 7.2 percent since the start of the year.

Ricafort said that aside from positive sentiments overseas, the continued net foreign buying supported the local stock market. Net foreign buying for the week Feb. 19 to 23 reached $30.1 million.

The strengthening of the peso against the US dollar also boosted market sentiment, he said.

Online brokerage firm 2TradeAsia.com said the impressive corporate earnings so far would also support the market’s upward momentum.

“The PSEi has so far held at 6,900 level, and is even showing signs of potentially being able to out-stamina the pressure around the 7,000 market,” 2TradeAsia.com said.

“The question of rates doing down later in the year is a major force impacting heightened volatility as the market attempts to price out this ‘tension’,” it said.

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