The stock market will likely trade higher this week in anticipation of strong gross domestic product figures that are being backed up by positive second-quarter corporate earnings.
The Philippine Statistics Authority is set to release the second quarter GDP results on Aug. 9.
Analysts said the recent slew of positive second-quarter corporate earnings report may give investors hope that GDP will remain strong despite rising inflation rate and the weakening of the peso against the dollar.
Online stock brokerage 2TradeAsia.com said quarterly corporate earnings report are shaping up to be in line with expectations despite cost pressures.
It noted that banks reported double-digit growths in consumer loans while property developers registered positive mall revenues and same-store-sales growth.
“As the index seemingly moves from strength to strength, be reminded that there are timing differentials to macro-events, earnings, and asset prices; while this makes market diligence blurry, this opens opportunities to trade oversold but high-quality securities. Aim for hopeful–but informed-farsightedness,” said 2TradeAsia.com.
The Philippine Stock Exchange Index last week gained 1.4 percent to close at 6,405.50 as investors weighed the recent wave of corporate earnings results. The broader All Shares Index advanced 1 percent to 3,432.06.
Sectoral indices ended mixed. Industrial rose 3.6 percent, holding firms climbed 2.3 percent and property added 0.9 percent.
The financials index dropped by 0.8 percent, while services and mining, and oil both declined 0.03 percent.
Foreign investors were net buyers for the week by P747 million, while the average daily value traded improved to P7.2 billion from the previous week’s average of P6.9 billion.
Weekly top price gainers were Universal Robina Corp., which rose 10.4 percent to P122.60; Eagle Cement Corp., which surged 10 percent to P14.32; and ABS-CBN Corp., which climbed 9.7 percent to P10.20. With AFP
Weekly top price losers were Security Bank Corp., which declined 9.4 percent to P82; Manila Electric Co., which decreased 7.1 percent to P316; and Alliance Global Group Inc., which dropped 5.8 percent to P9.31.
Global stock markets mostly fell Friday as a much stronger-than-expected US jobs report raised the prospect that the Federal Reserve will maintain its aggressive monetary policy to combat inflation.
Official data published Friday showed the US economy added 528,000 positions, defying all expectations of a slowdown.
Friday’s data also showed US wages jumped, which will add to inflation concerns and likely push the Fed to raise rates aggressively again next month.
The Fed has previously said its decision will be guided by data.
Markets fell after the “absolutely monster” jobs report leaves “the Fed with all the ammo it needs to keep on hiking a lot more,” Markets.com analyst Neil Wilson told AFP.
In Europe, London equities ended the day down 0.1 percent one day after the Bank of England unveiled a half-point interest rate hike and forecast UK inflation topping 13 percent on surging domestic energy bills. With AFP