MANILA, Philippines - Given a shortened trading week and the Dow Jones’ return to positive territory following a four-day slide, the local stock market is expected to move sideways this week with a slight upward bias.
Last week, the main composite index fell 53.19 points or 1.84 percent to close at 2,830.99 as investors cashed in on gains from the previous week. The decline was also attributed to the drop of markets worldwide particularly the Shanghai Composite Index.
“The way this week ended supports an upward movement next week. Further evidence of upward movement is the fact that according to the PSEi’s current upward trend channel, support can be found at 2,800,” said Prince Anthony Yeung of AB Capital Securities said over the weekend.
Yeung said trading was thinner last week as some investors chose to hold on to their stocks in anticipation of further price appreciation in the near term.
Concerns have been raised over China’s ability to meet its economic growth targets.
On the domestic front, the country’s growth target, currently at 0.8 percent to 1.8 percent, is expected to exceed current targets due to the second quarter’s better than expected 1.5-percent growth.
“Although the government has already revised its targets several times, thus somewhat lowering their credibility, this is will be the first time the revision is positive, which should serve as fuel for future rallies,” Yeung said.