Investors to remain cautious this week

MANILA, Philippines — Stock market investors remain cautious and as such, the benchmark Philippine Stock Exchange index (PSEi) is expected to trade range-bound, analysts said.

Juan Paolo Colet, managing director at China Bank Capital Corp., said the index would likely be range-bound this week as uncertainties over inflation and interest rates remain.

“This largely mirrors the US markets, so any critical movement there could affect local trading,” he said.

For this week, investors will also continue to wait for first quarter corporate earnings results.

“Ahead of macroeconomic data releases and the Bangko Sentral ng Pilipinas policy meeting results, market participants will focus on first quarter earnings announcements to drive selective price action,” Colet said.

For the earnings results, investors would be looking closely at consumer and real estate companies “to assess the impact of inflation and elevated interest rates on economic activity,” he added.

Last week saw tepid market activity as investors remained on the sidelines.

Average daily market turnover stood at P3.4 billion versus year-to-date average of P5.8 billion. Key performers were major banks as they reported robust earnings.

The PSEi inched up by 38 points to 6,520. The sectoral gauges were mostly up, led by financials, which was up by 1.93 percent and industrials, which rose by 0.92 percent. Mining and oil was down by 4.24 percent as was property, which lost 0.77 percent.

Net foreign buying stood at at a modest P69 million, down by 71.72 percent week on week.

2TradeAsia, for its part, sees immediate support at 6,400, with resistance at 6,600.

“Calendar of market events for this week imply that April will close with relatively less pizzas; however, brace for volatile window-dressing trading sessions as the chaotic first week of May looms. The Fed’s meeting on the second and third, plus economic indicators, should prompt watchers to possibly make early chess moves in upcoming sessions,” it said.

Upcoming window dressing sessions may provide opportunities for underpriced assets, 2TradeAsia also said.