Market likely to remain on consolidation mode

MANILA, Philippines - The local stockmarket is likely remain on a consolidation mode this week, tracking weak global cues.

Stock portal 2tradeasia.com said investors are expected to adopt a cautious stance because of a lack of impetus to move stocks higher. 

“A relatively cautious mood might greet trading activity early this week, following last Friday’s abrupt mid-day session selloff. For now, liquid fund managers might heed for additional time, to check if potential selling pressure has already abated given very few leads to consider at home and abroad,” 2tradeasia.com said in its weekly market report.

Last week, the Philippine Stock Exchange composite index fell 7.7 percent or 200.5 points to 2,398.30. Average daily volume declined to 1.65 billion shares from 2.93 billion shares last week but average value rose to P3.45 billion ($71.13 million) from P2.93 billion

Market players were cool to the financial reform program proposed by President Obama as they expressed concern over a possible over-regulation of the US economy.

First Metro Investment Corp.’s Junie Banaag said majority of index stocks promise little or no upside as they have reached overbought levels. 

“If index stocks do not correct in a meaningful way. Profit-taking will break the support of 2,360. The end-semester window diressing offers yet an opportunity to sell,” Banaag said.