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Stocks poised to trade sideways

Share prices are expected move sideways during this shortened trading week on thin trading as investors await the government’s decision on the possible lifting or extension of the enhanced community quarantine.

Financial markets will be closed on Thursday and Friday in observance of the Holy Week.

The Luzon-wide community quarantine that started March 16 will end on April 12. The Inter-agency Task Force on Emerging Infectious Diseases is evaluating if the enhanced community quarantine will be terminated, extended or expanded to include more areas.

Philstocks Financial Inc. research head Justino Calaycay Jr noted that the market advanced 10 percent in the past two weeks as investors started looking at the market for the medium to long term period.

“Prices are definitely cheap. Most have in fact retraced levels extending back 7 to 10 years. Prices... at some point not a few months back... nobody probably thought they’d see again—or worse! But this is our reality today and the prudent investor is able to adapt to the times and act accordingly,” Calaycay said.

The Philippine Stock Exchange Index last week rose 80.35 points or 1.64 percent week-on-week as local buyers stepped in, even as foreign investors were net sellers for the week by P33.5 billion.

“The market seesawed this week, although within a narrower band than it did last week, but traded higher anyway. With hardly any corporate developments to drive the market, it looked for guidance elsewhere, primarily from Wall St,” RCBC Securities said.

Among the weekly top gainers during the week were Aboitiz Equity Ventures Inc., which advanced by 22.8 percent to P39.90, Semirara Mining and Power Corp., which climbed 11.5 percent to P11.82, and Manila Electric Co., which rose 9.1 percent to P240.

Weekly top price losers were Ayala Corp., which declined 8.5 percent to P451, Robinsons Land, which fell 6.6 percent to P13.88, and Vista Land & Lifescapes Inc., which dipped 5.8 percent to P4.03.

Wall Street stocks, meanwhile, finished sharply lower Friday following a gloomy jobs report that analysts said represented a harbinger of far worse unemployment due to the coronavirus outbreak.

The Dow Jones Industrial Average ended down 1.7 percent, or around 350 points, at 21,052.53.

The broad-based S&P 500 shed 1.5 percent to 2,488.65, while the tech-rich Nasdaq Composite Index also dropped 1.5 percent to 7,373.08.

US employment plunged by 701,000 in March and the jobless rate surged to 4.4 percent, the Labor Department reported earlier Friday.

Yet the department acknowledged its statistics could not yet capture the full extent of the damage, and its own weekly data on first-time claims for jobless benefits showed 10 million people lost their jobs in the last two weeks of the month. 

“While this payroll report may appear dark, it sadly pales in comparison to the expected 24 million job loss in April,” Oxford Economics said in a note.

“With much of the US economy at a standstill and ten million individuals having filed for unemployment benefits over the last two weeks, the labor market has entered a traumatic period.” With AFP

Topics: Stock Market , Philippines Stock Exchange , PSE , Philippines Stock Exchange Index , PSEi , enhanced community quarantine , coronavirus disease 2019 , COVID-19
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