Investors to nudge index above 7,000 points again

Share prices are expected to move sideways over the near-term period as investors look for more catalysts to push the market beyond the 7,000-point mark.

Analysts said the hurdle can easily be reached given the decline in COVID-19 cases, the increased rate of vaccination across the country and the expected positive third-quarter earnings.

“The 7,000 mark remains within striking distance, and elusive as it may seem, some technical setup may be seen forming sometime in the fourth quarter, granted near term catalysts such as nine-month earnings and holiday inflation allow it,” online brokerage firm 2TradeAsia.com said.

“In any case brace for volatility and possible market-on-close calls in the coming weeks as 2021 nears its curtain call and the official race to 2022 begins,” it added.

The Philippine Stock Exchange Index 0.2 percent last to 6,906.86 after investors took profits after the index breached the 7,000-point level.

Four of the sectoral indices posted week-on-week increases, led by financial which rose 3.9 percent, mining and oil which advanced 3.5 percent, property which climbed 2.4 percent and industrial which gained 0.6 percent.

The services index declined 1.6 percent while holding firms fell 1.4 percent.

Foreign investors were net sellers for the week by P1.39 billion, while average daily value traded was steady at P12 billion.

Weekly top price gainers were Manila Water Co Inc., which jumped 28.8 percent to P23.80, Wilcon Depot Inc., which advanced 24.1 percent to P34.95, and Semirara Mining and Power Corp., which climbed 11.6 percent to P24.90.

Weekly top price losers were Converge Information and Communications Technology Solutions Inc., which dropped 15.8 percent to P33.60, First Gen Corp. which decreased 11.5 percent to P29, and Aboitiz Power Corp., which fell 6.6 percent to P29.55.

Meanwhile, global stock markets mostly dropped Friday following weaker-than-expected US jobs data as oil prices continued to rise, adding to inflation worries.

The much-anticipated Labor Department report showed the United States added only 194,000 jobs last month, less than half the number expected by analysts due to declining public sector staffing and lackluster hiring in bars and restaurants.

On the positive side, the unemployment rate ticked down more than expected to 4.8 percent, and the last two months’ jobs gains were revised upwards.

“It actually wasn’t as bad as it appeared,” JJ Kinahan of TD Ameritrade said of the monthly report, adding that the decline in hiring in schools skewed the overall figure.

Wall Street indices ended with modest losses for the day following a choppy session, but with weekly gains.

Analysts broadly expect the Federal Reserve to stick with a plan to soon taper stimulus. That sets the stage for more choppiness in the weeks ahead, Kinahan said.

“I think we’re going to continue to have more elevated volatility and volatile sessions because you’re seeing the market pressures on interest rates in anticipation of the Fed at some point talking about when they are going to exactly start tapering,” he said. With AFP