Stocks are expected to sustain their gains this week, as anxiety over the planned US rate hike and the United Kingdom’s exit from the European Union eased, analysts said over the weekend.
“Given the Fed rate scare is off for now, the PSEi [Philippine Stock Exchange index] may maintain its uptick next week. In addition, as of this writing, the Brexit referendum vote due next week has been suspended due to the murder of a pro-EU lawmaker,” RCBC Securities market analyst Jeremy Yumul said.
Analysts said the US Fed’s decision last week not to raise key rates this month would continue to buoy investor confidence in emerging markets, including the Philippines.
BDO Unibank Inc. investment strategist Jonathan Ravelas said the benchmark index could retest the 7,800-point level, after it pierced the 7,600 level last week.
“A break above the 7,800 could push the market to challenge the 8,000 levels. However, failure to break above the 7,800 levels could prompt some profit taking back towards the 7,500 levels,” Ravelas said.
The PSEi gained 112.13 points or 1.5 percent over last week’s five-day market trading to close at 7,622.07 on June 17.
Except for the services index which declined 0.4 percent, all major indices ended in the green led by financials (up 2.5 percent), industrial (up 2.3 percent) and mining and oil (up 1.7 percent).
The index started the week on the weak side after being haunted by the US Fed and Brexit referendum scare. However, the market recovered toward the end of the week on favorable Fed decision.
Foreign investors were net buyers last week of P487 million, as total foreign buying reached P19.97 billion while foreign selling amounted to P19.48 billion.
Top gainers last week were gaming firms Melco Crown (Philippines) Resorts Corp. which jumped 19.7 percent to P2.97 and Bloomberry Resorts Corp., which gained 12.2 percent to P5.90. Philex Mining Corp. advanced 8.9 percent to P9.21.
Heavy losers were DoubleDragon Properties Corp. which dropped 13.5 percent to P58.55 and Energy Development Corp. which declined 4.6 percent to P5.25. Globe Telecom Inc. lost 3.6 percent to P2,284.