Trading is expected to remain positive this week, as the benchmark index continues to build momentum toward the 8,000-point level, on the back of strong first-quarter earnings of listed companies and positive outlook on the economy.
BDO Unibank Inc. chief investment strategist Jonathan Ravelas said the market’s recent break above the 7,800 level signaled the market was back to bull territory. The market rose 20 percent from its recent low of 6,500 level.
“Chartwise, the week’s close at 7,841.99 highlights the market has the momentum to assault the 8,000 to 8,150 levels in the near-term. Any pullback, if any, is limited towards the 7,600 to 7640 levels,” Ravelas said.
RCBC Securities analyst Jeremy Yumul said the release of earnings results this week by several big companies such as Ayala group and San Miguel group should keep investors on their toes.
“In-line or forecast-beating results from these names could sustain the market’s rise,” Yumul said.
Meanwhile, newly elected Philippine Stock Exchange president Ramon Monzon said he was hoping the current strong market conditions would persist as some of the key agenda of the Duterte administration started implementation.
“What were are looking for and hopefully will spur trading and interest in the market is the passage of the tax reform bill. The passage of the tax reform bill and the implementation of infrastructure programs of the new administration will really have very positive effect on the market,” Monzon said.
The 30-company PSE index last week surged 2.4 percent to close at 7,841.99 on May 5, on strong first-quarter earnings and on expectation the first package of tax reforms would be approved by Congress.
The bellwether was also up 14.6 percent since the start of the year.
All major sub-indices ended in the green last week, led by property which jumped 4.9 percent and mining and oil index which surged 4.5 percent, following the rejection by the Commission of Appointment’s of the appointment of Reina Lopez as Environment secretary.
Foreign investors were net buyers by P1.98 billion last week, as total foreign buying hit P20.5 billion while foreign selling amounted to P18.5 billion.
Daily turnover also surged to P8.9 billion from P6.4 billion the previous week.
Top gainers were logistics company 2GO Group Inc. which jumped 25.6 percent to P16.20, Travellers International Hotel Group Inc. which climbed 8.2 percent to P3.57 and SM Prime Holding Inc. which advanced 8.1 percent to P32.20.
Heavy losers included cement manufacturer Cemex Holdings Philippines Inc. which retreated 5.3 percent to P6.95, Lopez Holdings Corp. which fell 4.8 percent to P7.32 and Alliance Global Group Inc. which declined 3.7 percent to P14.65.