Market optimism to continue this week
The Philippine stock market was off to a strong start at the opening of trading last week, which may be an indicator of things to come this year.
Traders said that with the strong start, the PSEi may try the 9,000 to 9,100 levels earlier than expected as investors cheered the passage of the Duterte administration’s tax reform package.
The benchmark Philippine Stock Exchange index (PSEi) reached new record highs in the first three trading days of the year.
Last week, the PSEi rallied anew, gaining 2.47 percent week-on-week to settle at 8,770 after the passage of the tax reform package.
“It will support the government’s Build Build Build program and thus improve the country’s infrastructure and boost the economy,” Jonathan Ravelas, chief market strategist at BDO said on the passage of tax reform package.
At the same time, he said some profit taking took place after hitting a new all-time high of 8,858.07 toward the end of the trading week.
“Chartwise, the week’s close at 8,770.00 highlights the market still has some gas to try the 9,000 to 9,100 levels. Immediate support and resistance is seen at 8,300 and 9,100 levels, respectively,” Ravelas said.
Chris Mangun, head of research of Eagle Equities, said the stock market opened quite strongly during the new year.
“We started 2018 with a bang with the PSEi up 2.47 percent in the first week of trading despite having only three trading days,” Mangun said.
He noted strong leadership from blue-chips with SM, BPI and SM Prime Holdings hitting new highs again last week. SM closed at P1,020 per share on Friday while SM Prime closed at P39.35. BPI closed at P113.80 per share.
“The excitement that we saw from investors pushed the index further into uncharted territory as we hit a high of 8,858.07 in the afternoon session on Friday,” Mangun said. Mangun said the optimism may carry on this week. “We go into this week with a lot of positive momentum after hitting new highs last week. We saw a bit of a correction on Friday which may continue this week,” he said.