Market seen remaining volatile

The stock market enjoyed some positive trading last week as a result of some good news such as the preliminary outcome of trade talks between US and China wherein both countries are leaning toward averting a full blown trade war.

However, traders said the rest of the trading sessions for the year would likely be volatile as investors retool their portfolio.

Immediate support is seen at 7,450 to 7,500, while resistance is at 7,600 to 7,700, according to F. Yap Securities.

Last week, the benchmark Philippine Stock Exchange index (PSEi) rose 63 points to settle at 7,524, which was up 0.85 percent week- on-week.

This was aided by holdings, which gained 1.93 percent; services, which rose 1.3 percent; and industrials, which also rose one percent.

Last week also, the Bangko Sentral ng Pilipinas also kept rates unchanged which was taken positively by investors.

“The BSP made a move to adopt a status quo on its benchmark interest rate, sending calming waves to the market. With tame inflation at home, BSP has other means at its disposal, possibly reserve requirement adjustments to control liquidity,” F. Yap Securities said.

Meanwhile, the US Fed will convene next week and their final move for the year will help support views that the global rate hike cycle will soon taper-off.

If the Fed keeps its rates steady, analysts said it may improve market liquidity.

On the domestic front, however, there might be no new leads with Congress already adjourned for the holiday break.

“However, more corporate actions ahead of 2019 prospects would be at the forefront, specifically on debt restrategies and inventory loading. Some might also close the year with M&A prospects, specifically those eyeing to go on backdoor listing,” F. Yap said.

It warned that volatility may color the eight remaining trading days for the year as fund managers retool their portfolios.

For the remainder of the year, F. Yap said there is a possibility that the index may reach 8,000 despite the volatility.

“The PSEi would likely stabilize within 7,500 to 7,700, with an angle to hopefully end the year within 7,800 to 8,000,” it said.