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Philippines: Easing lockdowns to spur market
MANILA, Philippines — Local stocks will seek guidance from the government’s decision on quarantine classification, particularly as the shift to granular lockdown will enable more businesses to reopen and people to return to work.
“The local bourse may take cues from the government’s decision regarding the quarantine classifications of the country. Last week’s positive performance is seen to be reflective of investors’ hopes toward the further easing of restrictions, primarily in the National Capital Region, the biggest contributor to our economy region-wise,” said Japhet Tantiangco, an analyst at Philstocks Financial Inc.
As restrictions are eased, he said, the local market’s upward momentum may continue to hold, but warned this could also be offset by an alarming rise in daily COVID-19 infections.
“Aside from the government’s quarantine decision, investors are expected to monitor our COVID-19 cases. For (last) week so far, our new case counts have averaged 17,645 per day, higher than the preceding week’s average of 16,174. If the uptrend continues, it may cause negative sentiment in the market,” Tantiangco added.
Chart wise, he said the market’s immediate support is seen at its 10-day exponential moving average at 6,781.72, while initial resistance is seen at 6,900 which could be tested this week.
If the market breaks and sustains ground at 6,900, next resistance is seen at 7,300, Tantiangco said.
Investors are also expected to watch out for upcoming July labor force survey and August inflation data for clues on how the economy is faring.
Last week, the PSEi closed higher week-on-week by 1.6 percent or 110.51 points to 6,897.13, after the previous week’s 2.3 percent gain.
The PSEi is now up for the third straight week.
Source: https://www.philstar.com/business/2021/09/06/2125088/easing-lockdowns-spur-market