30.2 C
Saturday, May 18, 2024

Stocks seen moving downward this week

- Advertisement -

Philippine stocks are expected to move sideways with a downward bias this week amid the lack of positive news or catalysts.

Analysts said the string of negative news here and abroad, the higher-than-expected US inflation rate, potential lower Philippine economic growth and delay in rate cuts, were forcing investors to remain on the sidelines and foreign funds to cash in on previous gains.

“The probability of an extended downtrend past 6,500 should warrant extra caution in trades,” online brokerage firm said.

“On this front, any stabilization above 6,600 level could open windows for short term range trading, at least while he broader market rationalizes capital cost outlook for the remainder of 2024,” it said.

Analysts said market sentiment was being weighed down by the recent upward adjustment in Bangko Sentral ng Pilipinas’ inflation target to 4 percent on worsening upside risks and the higher US inflation rate that could delay cuts in interest rates to the latter part of 2024 or early next year.

High inflation and interest rates could also affect corporate earnings in terms of reduced margins due to higher cost.

The 30-company Philippine Stock Exchange index dropped 1.28 percent to close at 6,659.29 on Friday, while the broader all-shares index lost 1.06 percent to 3,517.40 last week.

Average daily value turnover declined to P5.92 billion from previous week’s average of P7 billion as financial markets were closed for two days last week.

Foreign selling also accelerated to P1.72 billion from previous week’s P517.5 million.


Popular Articles