Investors await key economic data

Investors will keep an eye on key economic data coming out this week before making any moves at the local bourse, which has been struggling to stay within the green territory.

Rastine Mercado, research director at Chinabank Securities, told the Inquirer in an email that the Philippine Stock Exchange Index (PSEi) would be heavily influenced by both the October inflation print and third quarter gross domestic product growth.

Last week, the Bangko Sentral ng Pilipinas (BSP) said the rate of increase of the price of goods bought by a typical Filipino household may have settled within the 1.4-percent to 2.2-percent range.

Faster inflation is attributed to the higher prices of rice, fish, vegetables and electricity, according to the BSP.

October inflation is set to be released on Nov. 5.

At the same time, economists expect the country’s economic growth in the third quarter to have expanded at a slower pace due to recent typhoons and the ongoing corruption probe.

As such, Mercado said the bourse may retest the 5,900 support level and attempt to push back into the 6,000 level.

Last week, the PSEi failed to maintain its hold on the 6,000 territory and eventually dipped to 5,900 as the peso weakened against the US dollar.

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To recall, the local currency slipped to a historic low of 59.13 against the greenback, again partly due to the flood control scandal.

As a result, the PSEi closed last week at 5,929.68, down by 0.97 percent week-on-week.

Should corporate earnings turn out to be favorable this week, Mercado said this may “prompt the PSEi’s momentum.”