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MANILA – Philippine share prices are seen to climb this week as the mid-year window-dressing drew to a close and investors take on more risk after the EU pledged to help out troubled members.
Jose L. Vistan, senior research manager at AB Capital Securities, said the market would see a correction this week since profit-taking – mainly fueled by fund managers' window-dressing – has ended.
Last Friday, the Philippine Stock Exchange index went sideways for a third straight session, shedding 9.74 points to close the week at 5,246.410.
Total volume traded reached 3.033 billion shares worth P43.9 billion, bulk of which came from the P39 billion block sale of Eduardo "Danding" Cojuangco's remaining 11 percent stake in San Miguel Corp. to the company's chief operating officer, Ramon S. Ang.
"Last week's driver was mainly the window-dressing," Vistan said, adding that trading would be quiet since no critical economic numbers are scheduled for release this week.
Last month’s inflation already has been discounted by the market as benign.
"Past the half-way mark of the year, the market continues to show strength, despite heavy headwinds from external sources. This is a confidence vote on the domestic economic prospects which has remained rosy," Jun Calaycay of Accord Capital Equities Corp. said.
"A recent review of macro-targets resulted in keeping the original numbers despite the strong indicators posted in the first quarter – and the anticipated strong results for the second quarter. This is seen to provide more fodder to optimism that will reflect in a sustained uptrend in general equity prices," he added.
Besides the good local fundamentals, global markets cheered after European leaders on Friday agreed to provide aid to troubled banks and keep the financial crisis from spreading.
US stocks went up two percent, with the Nasdaq finishing three percent higher and the Dow Jones Industrial Average up 277.83 points to 12,880.09.
"Barring unforseen reversal of sentiments in Europe’s progress following a series of good news such as Greece’s election, EU leaders’ commitment to provide aid to troubled members and expanding EIB funding, investors are expected to increase exposure to risk-assets,” Calaycay said.
With that, market support is seen at 4,863.42 and a breach of the 5,300-mark "is not far-fetched," he added.
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