Thailand
Philippines stocks seen tracking pandemic, inflation data
The Philippine index is expected to monitor the country’s pandemic situation, along with the print of the September inflation rate, the developments global oil prices, and the performance of the Philippine peso this trading week.
Philstocks Financial Inc. senior research analyst Japhet Tantiangco sees the movement of the local bourse this trading week to be dependent on the local Covid-19 situation, as the daily tally of cases shows signs of improvement.
The Philippines logged 14,786 new Covid-19 cases on Saturday, bringing the total to 2.58 million.
Tantiangco said a continued lower number of cases could provide a boost for the market.
Worries, however, still linger on the upcoming release of the September inflation data, according to Tantiangco.
“If the September inflation rate comes out to be significantly higher compared to August’s 4.9 percent, then we may see a pessimistic reaction in the bourse,” he explained.
The Bangko Sentral ng Pilipinas on Thursday said the country’s inflation rate might have risen faster in September due to rising oil, electricity and food prices.
Tantiangco added that investors would also be on the lookout for global oil prices and the movement of the local currency.
The rising global oil prices, with the Brent crude standing near the $80 per barrel mark, are seen posing a downside risk.
“If the rally of oil prices continues, then it may cause negative sentiment in the market since it is expected to strengthen inflationary pressures in the country,” Tantiangco noted.
Meanwhile, the Philippine peso performed weak last week and returned to the P51:$1 territory after over a year.
Tantiangco said further depreciation of peso could lead to more foreign fund outflows, which would weigh on the local index.
For his part, Rizal Commercial Banking Corp. chief economist Michael Ricafort likewise cited the release of the latest inflation data as among the market’s major catalysts, as well as the trend in new Covid-19 cases in the country and the developments in the local inoculation program, among others.
Chartwise, Tantiangco sets the market’s 10-day exponential moving average as its initial support, which is currently at 6,922.66, followed by its 50-day exponential moving average presently at 6,814.24.
Resistance, on the other hand, is seen at the 7,000 to 7,100 range.
Last week, the benchmark Philippine Stock Exchange index (PSEi) slipped by 0.42 percent or 29.28 points to close its intraday low of 6,923.60 on Friday amid Wall Street’s overnight decline and expectations of a higher September inflation rate.
Source: https://www.manilatimes.net/2021/10/04/business/top-business/ph-stocks-seen-tracking-pandemic-inflation-data/1817005