PSEi seen holding above 6,000 on US-Iran truce

Philippine stocks may sustain their footing above the 6,000 level this week as easing geopolitical tensions offer relief, although lingering risks tied to the Middle East conflict could keep gains in check.

In its weekly outlook, brokerage 2TradeAsia said local equities regained poise above the key psychological mark after a two-week ceasefire between the United States and Iran triggered a sharp drop in oil prices, helping temper inflation concerns.

Given these crosscurrents, 2TradeAsia expects the market to trade cautiously this week, with immediate support seen at 5,800 and resistance at 6,050, with a secondary ceiling at 6,300.

Trading Edge Consultancy chief investment strategist Ron Acoba said the market may move “sideways with a little upside tilt,” noting that the two-week ceasefire could provide temporary relief. However, he warned that any disruption to the agreement could quickly reignite volatility.

“The two-week ceasefire between the US and Iran, assuming it stays, may provide some relief for the markets in the interim,” Acoba said.

For his part, Rizal Commercial Banking Corp. chief economist Michael Ricafort said global markets would continue to take cues from developments in the Middle East, particularly the ceasefire period running from April 7 to April 21 (US time).

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Last week, the Philippine Stock Exchange Index climbed 99 points or 1.66 percent, to 6,098.21, lifted by gains in mining and oil, which surged 7.4 percent, and services, up 3 percent.

Despite the advance, trading activity slowed. Average daily turnover declined 38 percent to P8.73 billion, while net foreign selling narrowed significantly to P729 million, down 63 percent.