MANILA, Philippines - The bounceback from the crucial 5,900 territory and continuous bargain hunting amid easing economic concerns will augur well for the local stock market this week, analysts said.
Analysts remain hopeful that the equities market will pick up anew starting this week given ample liquidity and strong consumer spending in the fourth quarter.
“I feel generally positive just because nothing has really changed as far as the economy is concerned. I hope to see the market continue its upward trend to around 6,400,†BPITrade.com director Richard Anthony Liboro said in a phone interview.
Jonathan Ravelas, chief market strategist of BDO Unibank Inc., said the rebound to the 6,200 level confirms the near-term low at 5955.07, the lowest point last week. This will allow the Philippine Stock Exchange index (PSEi) to test the 6,350-6,500 levels, he said.
“Following its close last Friday at its intraday high of 6,208 prospective crosses of the PSEi above 6,267 will validate an ascent to 6,400, assuming no untoward supply pressure would be encountered at this level,†said online brokerage firm 2Trade-Asia.com.
Benchmark PSEi rallied 2.04 percent or 123.98 points to 6,208.82, snapping three consecutive weeks of decline.
2Trade-Asia.com said the local bourse benefited from a post-Thanksgiving cheer amid improved US economic data while regional markets were buoyed by China’s economic reform to accelerate capital market development.
For Freya B. Natividad, investment analyst at Papa Securities Corp., the main index might consolidate, with trading at 6,100 to 6,300. “I think investors are looking for more encouraging news because of the negative effects of typhoon Yolanda for the fourth quarter,†Natividad said.
Selective buying will mark the week, particularly for stocks battered in the previous weeks, Liboro said.
Despite near-term threats of higher consumer prices, inflation will generally be tame next year, bolstering interest in financials, property and holding firms, 2Trade-Asia.com said.