Fed, BSP meetings seen affecting trade this week

By Denise A. Valdez
Reporter

PHILIPPINE STOCKS are seen to move this week in accordance with market sentiment on the central bank’s policy meeting and any tariff adjustments by the United States on Chinese products — two events scheduled in the coming week.

The 30-member Philippine Stock Exchange index (PSEi) climbed 10.81 points or 0.13% on Friday to close this month’s first week of trading at 7,801.72.

On a weekly basis, the main index was up 0.81% to record its first week of gain after three weeks of decline.

Value turnover last week averaged P5.932 billion to trim 34% from a week ago. Activity from foreign investors saw a turnaround with net buying at P89 million from a net selling of P1.6 billion in the prior week.

Online brokerage 2TradeAsia.com said much of the local bourse’s performance last week was driven by volatile mood that swept most markets across the region.

Heading into a new week, it said the Sino-US trade talks, monetary policy and water concessionaires’ battle with government will be the main drivers of the stock market.

“Emotions are bound for a rough patch in the coming days, as 15 December’s US tariff implementation deadline on Chinese imports loom,” 2TradeAsia.com said in a market note sent Friday.

It noted there are polarizing opinions from investors on whether the trade talks would be enough to trigger tariff rollbacks or if the political climate will cloud expectations of a tariff resolution.

“For now, remarks that would be given along these lines would cause share prices to fluctuate, unless both major parties come to amicable terms,” it said.

2TradeAsia.com likewise said the meeting of the US Federal Open Market Committee on Dec. 10-11 will impact global equities, on top of the policy review of the Bangko Sentral ng Pilipinas on Dec. 12.

Also to be watched is market sentiment on infrastructure projects that are of similar nature as that of water concessionaires, which drew the ire of President Rodrigo R. Duterte last week.

“Sequels to water concessionaires’ concerns may cast some cloud on the fate of other similar infra projects, especially within capital-intensive utilities… Learn to look at temporary set backs as opportunity to move into stocks with fundamentals that have run the test of time,” 2TradeAsia.com said.

Aside from upcoming events, Regina Capital Development Corp. Head of Sales Luis A. Limlingan said the local bourse may start this week’s trading with a gain on the back of positive sentiment spilling over from the US jobs report that came out Friday saying jobs increased 266,000 in November.

Mr. Limlingan is putting the PSEi’s support level at 7,760 and resistance at 7,920.

For 2TradeAsia.com, the PSEi’s immediate support is seen between 7,500-7,700, while resistance is between 7,850-7,950.