PSEi seen to hit 7,000

MANILA, Philippines - The local market is expected to test the uncharted 7,000 level for the main index as investors position ahead of the first quarter earnings season.

Profit takers, however, might temper gains this week and lead the bellwether index to trade sideways, analysts said.

Chartwise, the Philippine Stock Exchange index (PSEi) is seen to range from 6,750 to 7,000 this week, said Jonathan Ravelas, chief market strategist of BDO Unibank Inc.

“However, profit taking activities near the recent tops could occur,” Ravelas said.

“We expect the market to eventually reach another breakthrough as corporate earnings reports continue to come in and demonstrate the attractiveness of our listed companies,” said PSE president and CEO Hans B. Sicat.

Astro C. del Castillo, managing director of First Grade Finance Inc., said the main index would test the 7,000 level this week.

“It seems like there is momentum in the previous trading so moving forward, there is a sideways and upward trend,” Del Castillo said.

Week-on-week, the PSEi rose 0.95 percent or 65.67 points ending at its 26th record high at 6,957.10 for this year, eclipsing the April 12’s finish at 6,891.43. It is also the new intraday high, beating the 6,956.92 set on April 1.

Year-to-date the benchmark for the local stock market’s performance has jumped 19.7 percent or 1,144.37 points.

Aside from news on corporate income, investors will monitor leads overseas.

“We will take cues overseas particularly the economic developments,” Del Castillo said.

“Developments abroad have also been generally optimistic, particularly on the expectations that the Chinese economy will be able to rebound in the next few months,” Sicat said.

Del Castillo said the market would also be encouraged by easing tensions in the Korean peninsula.