Flat trading expected; eyes on inflation, unemployment

Share prices are expected to keep their sideways movement this week on rising new infections that will may temper any rally.

Utradeph.com, online stock trading arm of Unicapital Securities Inc. said consumer confidence is now better compared to last year’s as more businesses have adjusted to the new norm of stringent quarantine restrictions.

Variants of the COVID-19 virus, however, will continue to pose risk to public health and the economy moving forward.

Analysts said investors will be looking at the release of the August inflation rate and employment data scheduled this week that may affect this week’s trading.

While inflation rate will likely remain within government’s expectations, analysts said the recent manufacturing data and the lockdown implemented by the government could indicate a possible decline in employment figures.

The Philippine Stock Exchange Index last week rose 1.6 percent to 6,897.13 while the broader All Shares Index climbed 1.4 percent to 4,261.69.

Except for the property index which slipped 0.6 percent, all counters posted week-on-week gains led by mining and oil which jumped 4 percent, holding firms which advanced 3.2 percent, and industrial which gained 3 percent.

Foreign investors were net buyers for the week by P449 million, while the average daily value traded reached P9.2 billion from the previous week’s average of P6.8 billion.

Weekly top price gainers were Global Estate Resorts Inc., which soared 52.8 percent to P1.33, and Leisure & Resorts World Corp., which jumped 18.7 percent to P1.90. Share prices of both companies rose after the government said it would allow casinos to operate in Boracay.

Top losers were GMA Network Inc., which declined 5.8 percent to P12.88, Globe Telecom Inc. which dropped 5.1 percent to P2,702 and MacroAsia Corp., which fell 3.9 percent to P4.61.

Meanwhile, Wall Street stocks shrugged off a disappointing August US jobs report Friday that could delay the phasing down of monetary stimulus, while Tokyo rose on stimulus hopes after Japan’s prime minister signaled his exit. With AFP

The United States gained only 235,000 jobs last month, according to government data released on Friday, far below expectations and a possible harbinger that the Delta variant is harming the US economic recovery.

But US stocks had a muted reaction to the report, with the Nasdaq edging to third straight record.

The figure is likely to encourage the US Federal Reserve to hold off from beginning to wind down its stimulus to support the economy at its September meeting.

“Time will tell if this is just a speed bump for America’s rapidly accelerating economy, or if job creation has genuinely veered off course,” said Jay Mawji, managing director of global liquidity provider   IX Prime.

“But the markets are focused on the Fed’s next move. Barring any surprises over the next couple of weeks, the Fed is likely to keep rates at their current low level, sending the dollar into the weekend deep in the red,” he added.

Earlier, European stocks gave up early gains to finish lower.