Market likely to move sideways
Stocks are expected to trade sideways this week, as the market enters the ‘ghost month’ in China’s trading and as investors wait for the next catalyst that could push prices upward.
There will be no trading on Aug. 21, a non-working holiday which is celebrated in honor of the late senator Benigno Aquino.
Online brokerage firm 2TradeAsia.com said the market could trade on thin volume, with the start of the Chinese ghost month which would end Sept. 19.
The depreciation of the peso against the dollar could also force investors to look for alternative assets such as precious and base metals and select commodities given the near-term view of higher raw material prices, analysts said.
“Steer clear of stocks that have no adequate forex hedge. Aim for those with incremental earnings per share on dollar-based receipts,” 2TradeAsia.com said.
The 30-company Philippine Stock Exchange index gained 1.1 percent over last week’s five-day market trading to close at P8,016.73 on Aug. 18, while the all-share index also rose 1.1 percent to 4,734.84, on the back of strong second-quarter growth.
The government last week reported that the gross domestic product expanded 6.5 percent year-on-year in April to June, slightly higher than analysts’ expectation of 6.4-percent growth.
All major sub-indices ended in the green, led by industrial which climbed 2.5 percent, mining and oil which advanced 2.1 percent and property which rose 1.6 percent.
Foreign investors were net buyers by P915 million, while average daily turnover rose to P6.8 billion from the previous week’s average of P6.2 billion.
Top gainers last week were PXP Energy Corp. which jumped 20.3 percent to P3.90, Bloomberry Resorts Corp. which climbed 9.2 percent to P9.83 and Jollibee Foods Corp. which went up 8.7 percent to P235.
Heavy losers included Robinsons Land Corp. which declined 6.5 percent to P22.85, Philippine National Bank which dipped 3.1 percent to P61 and ABS-CBN Corp. which went down 2.4 percent to P41.75.