PHILIPPINE SHARES may remain weak this week as market sentiment stays cautious, with US President-elect Donald J. Trump set to take office on Monday and amid the absence of fresh catalysts.
On Friday, the benchmark Philippine Stock Exchange index (PSEi) rose by 1.38% or 86.60 points to 6,352.12, while the broader all shares index increased by 0.76% or 27.95 points to 3,703.73.
However, week on week, the PSEi fell by 2.22% or 144.20 points from its 6,496.32 finish on Jan. 10, marking its second straight weekly decline.
“Local equities tracked regional peers, succumbing to profit-taking ahead of Mr. Trump’s inauguration. Shaky global capital markets were gripped by politico-economic anxiety,” online brokerage firm 2TradeAsia.com said in a market note. “Apart from uncertainties in trade, immigration, and taxation, the overall well-being of the US economy has been sending pain signals to the rest of the globe.”
“The local market has turned more bearish as it extended its decline. At the same time, the market has broken below the 6,400 level, which previously served as a support line,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
The week saw the benchmark index fall to the 6,200 level twice as the release of key US inflation reports caused markets to recalibrate their Federal Reserve policy easing expectations.
On Thursday, the PSEi sank to 6,265.52, which was its lowest close in nearly seven months or since it ended at 6,158.48 on June 21, 2024.
For this week, Mr. Trump’s inauguration will likely be a key source of leads for the market, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
“We still expect the cautious atmosphere to remain in the local bourse amid the lack of fresh leads. Investors are expected to wait for new catalysts. Until then, cues are expected to come from other financial markets,” Mr. Tantiangco said.
“We may also see episodes of bargain hunting given that the local market is still at attractive levels, fundamentally speaking,” he added, putting the PSEi’s support at 6,150 and resistance at 6,400.
For its part, 2TradeAsia.com placed the market’s support at 6,000 and resistance at 6,500.
Mr. Trump arrived in the Washington area on Saturday evening for a celebration of his return to power, Reuters reported.
In the Capitol Rotunda, Mr. Trump will be sworn in at 12 p.m. ET (1700 GMT) then deliver an inaugural address, a speech that typically sets the tone for the president’s four-year term. He told NBC News the theme would be “unity and strength, and also the word ‘fairness.’”
Once he returns to the White House on Monday afternoon, Mr. Trump is expected to begin signing dozens of executive orders and directives to crack down on migration, boost US energy production and other priorities. — Revin Mikhael D. Ochave with Reuters
