Share prices are expected to maintain their sideways movement this year as investors remain cautious about the rise in the number of COVID-19 cases in the country and around the world that could delay the recovery of the economy.
“The week’s close at 6,315.07 highlights the risk on themes remain vulnerable and the test towards the 6,500 levels remain challenging in the near-term. Watch out for a break below 6,230 levels as it signals the retest of the 6,000 levels,” BDO Unibank Inc. chief investment strategist Jonathan Ravelas said.
Analysts said the decline in remittances from overseas Filipinos workers in March could further weaken consumer spending.
The government last week reported that that OFW remittances fell 4.7 percent in March, the most since March 2018.
“This caused foreign funds and local investors to lighten up their positions,” Ravelas said.
Concerns bought about the Asian Development Bank’s projected 3.8-percent contraction in the Philippine gross domestic product (GDP) and COVID-19 worries will continue to affect market sentiments.
The Philippines Stock Exchange Index last week declined 2.5 percent to 6,315.07, while the broader All Shares Index dropped 3 percent to 3,684.55.
All major sub-indices ended in red led by industrial, which fell 5.3 percent, followed by mining and oil which lost 4.4 percent, and property which decreased by 4.3 percent. Services also dipped by 3.32percent while financials and holding firms went down 3.2 and 0.2 percent, respectively.
Foreign investors were net sellers for the week by P5.08 billion, while athe verage daily value traded increased to P9.3 billion from the previous week’s average of P8.5 billion.
Shares of newly-listed MerryMart Consumer Corp. surged 96.7 percent last week to P2.95 from its initial public offering price of P1.
Global stocks, meanwhile, were mixed Friday as markets weighed hopes that business activity would get back to normal against worrisome coronavirus trends in several parts of the United States, while the World Health Organization warned of new outbreaks.
Bourses in Europe and Asia finished higher and the US at first seemed headed for another positive session as well.
But the tide turned around midday on Wall Street after Apple announced that due to rising coronavirus cases, it would close some stores that had reopened.
While coronavirus figures have fallen sharply in the Northeast and much of the Midwest, states including Florida, Nevada and Arizona have reported record case counts in recent days.
Apple’s announcement sent all three major US indices into the red, although the Nasdaq eked out gains to close narrowly higher.
Maris Ogg of Tower Bridge Advisors said Apple’s move reflects “the way this virus cycles geographically” and shouldn’t meaningfully affect the outlook for the US.
“We have some major things that can be working toward improvement,” Ogg said, pointing to the bounce from reopening the economy and rising strength in the housing market.
The World Health Organization warned of a “new and dangerous phase” of the coronavirus pandemic, with people tiring of lockdowns despite the disease’s accelerating spread. With AFP