Traders look to Q3 earnings to boost PSEi

The beginning of the busy and often volume-heavy earnings season will set the stage for the stock market this week, with investors already elated by initial results.

Stock trading platform 2TradeAsia.com said over the weekend that the benchmark Philippine Stock Exchange Index (PSEi) may plant its feet around the 7,500 territory should listed firms continue to report positive third-quarter income results.

“Release of corporate guidance, both in earnings and capex (capital expenditure), heading into 2025 is also expected to stir additional excitement in the short-term,” 2TradeAsia said.

The PSEi has yet to breach the 7,500 barrier after temporarily closing above it early this month.

On Friday, the bourse snapped a two-day losing streak and ended at 7,415.73, up by 1.5 percent week-on-week following Zobel family-led Bank of the Philippine Islands’ report of record nine-month earnings.

The Bangko Sentral ng Pilipinas’ (BSP) 25-basis-point cut in the benchmark interest rate of banks was not enough to jolt investors early in the trading week, due mainly to the weak peso, which is still at the 57 level against the US dollar.

Analysts have said the banks were poised to benefit the most from the rate cuts as borrowing costs decline, resulting in higher loan demand that could pull up profits.

While the PSEi has also suffered bouts of declines recently, it remained in the bull territory. For a stock market to reenter the bear territory, it needs to decline by at least 20 percent from its recent peak.

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“The dovish monetary policy outlook of the [BSP] is still expected to give the market support,” said Japhet Tantiangco, senior analyst at Philstocks Financial Inc.

This week, 2TradeAsia sees the benchmark index’s support level at 7,200 and resistance at 7,500 to 7,600.

Meanwhile, Tantiangco said resistance would be at 7,700, especially if the peso manages to strengthen this week.