Market to trade in narrow range

Share prices are expected to remain range-bound this week on foreign selling and lack of catalysts to push the market higher.

First Metro Investments Corp. said the index may temporarily hit 5,500 points before trekking upward to 6,500 to 7,000 by year-end as lockdowns ease.

Given this expectation, First Metro said investors must be selective in their stock acquisition and consider the financial conditions of companies, industry leadership and the external environment before investing their money.

The current slump in the market could encourage bargain hunting. But analysts said investors are still staying on the sidelines on expectations the market could still go down further.

Meanwhile, the stable August inflation rate and the strengthening of the peso against the dollar are providing the positive backdrop for the possible quick recovery of the domestic economy.

The Philippine Stock Exchange Index last week fell 1.7 percent to 5,785.09, while the broader All Shares Index slipped 1.2 percent to 3,493.73.

Except for the industrial sector which added 0.30 percent, all other sub-indices ended in red, led by property which declined 2.7 percent and holding firms which lost 1.7 percent.

Services rose 1.7 percent while financial and mining and oil dipped 0.3 percent and 0.2 percent, respectively.

Foreign investors were net sellers for the week by P3.7 billion, while the average daily value traded stood at P5.9 billion from the previous week’s average P9.1 billion.

Weekly top price gainers were Bloomberry Resorts Corp., which jumped 14.4 percent to P7; EEI Corp., which climbed 12.8 percent to P6.42; and Century Pacific Food Inc., which advanced 6.6 percent to P17.30.

Weekly top price losers were ABS-CBN Corp., which fell 6.2 percent to P6.80; GT Capital Holdings Inc., which declined 5 percent to P380; and SM Prime Holdings Inc., which dropped 4.3 percent to P27.95.

Meanwhile, US stocks ended lower again Friday, with tech shares tumbling in a continued selloff ahead of the holiday weekend, shrugging off data showing US unemployment falling more than expected in August.

At the closing bell, Dow Jones Industrial Average shed 0.6 percent to finish the week at 28,133.31, while the broad-based S&P 500 dropped 0.8 percent to 3,426.96, both recouping from the day’s low point.

The tech-rich Nasdaq Composite Index fell 1.3 percent to end at 11,313.13, adding to the losses from Thursday’s 5.0 percent rout. Markets are closed Monday for Labor Day.

After a strong summer that saw US indices enjoy their best August in decades, equities tumbled on Thursday with high-flying tech shares leading the market lower as investors cashed in on the big gains.

Amazon and Facebook were among the major losers in the session, dropping close to three percent, although Apple recovered enough to close flat.

Microsoft dropped 1.4 percent even after news just before the close that the Pentagon confirmed a $10-billion contract for the JEDI cloud computing program, despite a lawsuit from Amazon alleging bias given President Donald Trump’s frequent attacks on the company and founder Jeff Bezos. With AFP