Shares seen sideways as market hunts for leads
By Arra B. Francia, Reporter
SHARES MAY continue trading sideways this week as investors wait for new leads that could help lift sentiment.
The benchmark Philippine Stock Exchange index (PSEi) climbed 0.53% or 42.45 points to close at 7,915.63 on Monday, marking its second day in positive territory.
Turnover remained thin at P5.40 billion on Monday, slightly higher than the previous session’s P5.04 billion.
Market breadth on Monday was on the positive side with 107 advancers versus 91 losers, while 50 names ended flat. Foreign investors have been on net buying mode for two straight sessions, posting net purchases of P496.59 million on Monday.
Financial markets were closed yesterday for the Araw ng Kagitingan (Day of Valor) holiday.
“Moving forward, the local market may move sideways for the remainder of the week still under thin trading. We don’t have much local catalysts so investors would be looking offshore for clues this week,” Philstocks Financial, Inc. Research Associate Japhet Louis O. Tantiangco said in a mobile phone message.
Mr. Tantiangco pointed to the release of the minutes of the US Federal Reserve’s meeting last March 19 to 20, as well as the result of the European Central Bank’s (ECB) policy review.
“Both of these will provide hints on the direction of the global monetary condition which is highly considered in equity markets,” he explained.
The minutes will show how the Federal Reserve decided to keep interest rates steady this year, while hinting at one increase in 2020. This is amid fears about the health of the US economy.
Meanwhile, the ECB will hold its policy meeting on Wednesday, which analysts expect to be uneventful except for speculations that ECB President Mario Draghi may introduce a tiered deposit system to lessen the impact of negative rates on banks.
Happening on the same day as the ECB policy meet is the European Union (EU) summit, which is set to discuss Brexit. The EU will also be holding a summit with China to discuss trade relations.
Locally, investors will be watching out for the release of February trade balance data on April 11, Thursday.
Wall Street indices were mixed on Monday, with the Dow Jones Industrial Average down by 0.32% or 87.93 points to close at 26,341.02. The S&P 500 index gained 3.03 points or 0.10% to 2,895.77, while the Nasdaq Composite index added 15.19 points or 0.19% to 7,953.88.
“Trading resumes on Wednesday after [Tuesday]’s holiday — movement should be taken from how US markets move the next two nights,” Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said in an e-mail.
The PSEi is set to have another shortened trading period next week, as investors pause for the Holy Week break on April 18, Thursday, and April 19, Friday.
