Stocks face volatile week

MANILA, Philippines - Local stocks may face a bleak, volatile trading week as investors grapple with uncertainty about the global economic outlook, especially with inconclusive results from the recent Greek election and JP Morgan Chase & Co.’s $2 billion trading loss.

Accord Capital’s Jun Calaycay said the market will continue to test the strength of the 5,150 support level amid pessimism over recent developments abroad.

“The outlook is divided, mainly due to rising concerns over the re-emergence of turbulence from Europe. Important economic numbers in the US may provide additional pessimism, depending on the results,” Calacay said.

“The uncertainty over the direction the new leadership will pursue will be closely watched. The debates shift back to compliance with previous bailout conditions as well as Greece’s continued membership in the common currency region,” Calaycay said.

Last week, the Philippine Stock Exchange index sustained its 5th weekly loss, shedding 1.15 percent to close at 5,169.

Calaycay said investors are awaiting the release by the US Federal Reserve’s meeting minutes as they look for more guidance on whether the Central Bank plans to give additional help to the US economy.

He, however, sees some upside given the strength of the Philippine macroenomic fundamentals.

“Our advantage is that the domestic front has given a fair balance to external shocks. We remain on track to hitting our targets and this should augur well for company fundamentals as the year progresses,” Calaycay said.