PSEi seen trading sideways this week

The Philippine stock market is expected to trade sideways with a slight upward bias this week as investors await June inflation data and the start of the corporate earnings season, according to market analysts.

Brokerage firm F. Yap Securities said expectations of slower consumer price growth could help sustain the benchmark Philippine Stock Exchange Index’s (PSEi) recent climb toward the 6,200 to 6,400 range, provided inflation comes in lower than May’s 6.8-percent print.

Trading Edge chief investment strategist Ron Acoba said market sentiment improved after the index successfully held support near the 6,000 level, although a stronger rally would require broader participation from heavyweight stocks.

“Until then, gains may remain measured despite the positive bias,” he said.

Acoba said buying interest has also started to spread across conglomerate, banking, property and consumer counters, a development that analysts view as a healthier backdrop for a sustained recovery.

“If this rotation continues and more index constituents participate in the advance, it would provide a healthier foundation for the PSEi to extend its recovery and potentially transition into a more sustained uptrend,” he said.

For its part, F. Yap expects banks to remain among investors’ preferred picks heading into the release of first-half earnings results, citing robust net interest margins and potential write-backs of conservative provisions.

Mining stocks may also benefit from easing US rate hike concerns and improving sentiment toward commodities.

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