Stocks likely to move sideways
The local stock market may move sideways this week as investors tread cautiously while waiting for fresh leads, with current market levels presenting opportunities for bargain hunting.
Manila, Philippines - The local stock market may trade in a range this week as cautious investors await new information, presenting opportunities to acquire stocks at bargain prices. The Philippine Stock Exchange index closed lower on Friday at 5,593.49 points, slipping 2.92 percent on a week-to-week basis. AB Capital Securities attributed the market's decline to the weakening peso and negative sentiment stemming from the MSCI deletion.
This week, analysts will be watching the critical support level of 5,580. A break below this level could expose pandemic-era lows, as MSCI-related positioning intensifies ahead of the November 27 rebalance. Investors will likely keep a close eye on the ASEAN Summit, where regional economic and geopolitical matters will be addressed. Trading activity could remain relatively low this week due to ASEAN-related holidays and shortened trading sessions.
Wendy Estacio-Cruz, head of research at Unicapital Securities, noted that while a drop in oil prices might offer some relief from inflation concerns, persistent inflation and worries about weakened economic growth could keep investors on edge. Online brokerage 2tradeAsia.com is anticipating volatility in crude prices due to the US-Iran diplomatic standoff and the International Energy Agency's fourth-quarter surplus reassessment. They are now treating stagflation as the base case rather than a risk.
The brokerage emphasized that labor data will be closely monitored next, as September unemployment rose to 5.4 percent, potentially dampening consumption in the fourth quarter. "Overall, these conditions leave little room for policy intervention; with markets already pricing in a Fed hike on Dec. 9, with three more hikes by mid-2027, the most conservative expectation is that the BSP will raise rates by 25 basis points on Dec.
17," 2tradeAsia.com stated. The brokerage also expects MSCI-related selling to pick up ahead of the November 27 index rebalancing, with the deletion of Meralco and the downgrade of PLDT to Small Caps.
COL Financial indicated that the market could experience heightened trading activity and potential buying or selling pressure when the index is rebalanced on November 27.
Written by urgent.news from Philippine Star Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
