Stock market likely to bounce back

posted February 28, 2021 at 06:45 pm
by  Jenniffer B. Austria
Share prices this week are expected to recover from their recent slump with the much anticipated arrival of COVID-19 vaccines this week.

The government said more than 500,000 AstraZeneca vaccines will also arrive in the country this week aside from the 600,000 Sinovac vaccines from China,

Analysts said the arrival of the vaccines would finally enable the government to kick off its vaccination program and eventually reduce the number of COVID-19 cases in the country.

“The next big impetus will be on the national vaccination drive,” online brokerage firm

But with some sectors expressing strong resistance against vaccination, the overall plan of achieving herd immunity could face a delay. This means the broad public could still be under strict quarantine rules that, in turn, may affect consumer and business confidence.

“In short, it all boils down to vaccines—and until the program gets traction, the PSEi’s streak to 8,000 will all be a lofty ambition,” 2TradeAsia said.

Investors are set to monitor the release of earnings results of listed companies, including their outlook and expansion plans over the next few years.

Among the companies scheduled to release their 2020 financial results this week are Metro Pacific Investments Corp., PLDT Inc., Manila Electric Co. and International Container Terminal Services Inc.

The Philippine Stock Exchange Index last week sank 131 points, or 1.9 percent week-on-week, to 6,794 as Metro Manila was kept under strict quarantine measures.

President Rodrigo R. Duterte said he would only consider shifting Metro Manila to a modified general community quarantine status once the country started to roll out its vaccination program.

The financials and property sector rose 0.4 percent and 0.3 percent, respectively. However, four other indices registered week-on-week declines led by holdings (-3.7 percent), industrial (-3.7 percent), industrial (-3.4 percent) and services (-1.8 percent).

The average value turnover fell to P11.9 billion while average net foreign selling rose to P1.1 billion.

Meanwhile, stocks slumped worldwide on Friday despite a drop in bond yields, as rattled investors did not step in to pick up bargains.

The dollar rose against its main rivals in anticipation of the US Congress later Friday voting  later Friday on President Joe Biden’s enormous $1.9-trillion economic rescue package.

Oil prices fell after striking 13-month peaks Thursday on keen demand.

Vaccine rollouts, slowing COVID-19 infection rates, and Biden’s stimulus package have sent stocks up in recent weeks. But that good news is proving to be a double-edged sword for traders as they weigh the much-needed return to pre-pandemic life against the prospect that prices could rise, possibly sharply.

There is a worry that surging inflation could threaten one of the key pillars of the rally on world markets from their March nadir: record-low borrowing costs.

Alarm bells have been ringing for weeks as the yield on benchmark 10-year US Treasuries climbed to one-year highs earlier this week as investors moved out of the safe haven of government bonds. With AFP

Topics: Stock Market , Philippine Stock Market , PSE , Philippine Stock Exchange Index , PSEi , global stock market
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