PSEi seen consolidating near 6,000
Philippine shares are expected to trade sideways near the 6,000 level this shortened holiday week. This, as thinner volumes and year-end de-risking temper market momentum, according to online brokerage 2TradeAsia.
The Philippine Stock Exchange index (PSEi) ended last week at 5,920.87, down 2 percent week-on-week. This was after the PSEi slipped below the 6,000 psychological mark amid pre-holiday profit-taking.
Losses were led by the industrials sector which slid 7.5 percent and the property index which declined 1.3 percent.
Meanwhile, gains in financials which rose 1.6 percent and holding firms which edged up 0.34 percent helped temper the overall decline.
Trading activity picked up despite the pullback, with weekly value turnover climbing 38 percent to P10.36 billion. The average daily turnover jumped 156.7 percent to P18.69 billion, signaling continued participation even as investors trimmed exposure.
RCBC chief economist Michael Ricafort said the recent pullback should be viewed as healthy consolidation rather than a reversal. He said this was especially so after the index held above 6,000 for several sessions earlier this month.
“The PSEi corrected lower, considered healthy profit-taking, after gaining for most trading days since last week,” Ricafort said.
He noted that the index recently reached an intraday high of 6,112.20 on Dec. 16 before easing.
“Still, holding above 6,000 for several days is a good signal for the local market if that level is sustained,” Ricafort said.
The economist added that the index remains among its strongest levels in nearly two months. The near-term bottom was already seen at 5,584.35 in mid-November, which he said helped attract bargain-hunting from long-term investors.
Foreign selling, however, persisted. Net foreign outflows narrowed to P384 million, as foreign selling of P6.01 billion continued to exceed foreign buying of P5.62 billion.
2TradeAsia said global markets remain divided. Softer economic indicators in the United States contrasted with weaker growth trajectories in China and Europe.
