By Denise A. Valdez
Reporter

LOCAL SHARES are seen to remain volatile this week as the end of the Luzon lockdown looms and annual stockholders’ meetings begin.

The benchmark Philippine Stock Exchange index (PSEi) added 264.37 points or 4.78% to end at 5,789.97 at the session’s close on Friday. On a weekly basis, the main index climbed 5% to sustain its fourth straight week of increase.

Value turnover last week grew 33.7% to an average of P7.65 billion. Net foreign selling continued to grow with a 48.4% expansion to P1.24 billion on average.

Online brokerage 2TradeAsia.com attributed the rise of the PSEi to the central bank’s 50-basis-point rate cut which took effect on Friday. Pent-up buying was another driver for the market’s sustained rally.

For the coming week, as the country inches closer to the April 30 deadline of the extended Luzon enhanced community quarantine (ECQ), 2TradeAsia.com said investors will remain watchful of any development that would show signs of recovery from the coronavirus disease 2019 (COVID-19) pandemic.

“The risks are straightforward to recognize, but complex to resolve: (1) the scenario of possible second wave of COVID-19 infections that could lead to another ECQ in the second half, or (2) risk a deeper economic fallout that may prod the private sector to provide more lifeline funding,” it said.

It noted suggestions by business groups that the government could allow a gradual opening of select sectors to kickoff the recovery of the economy.

Any decision on the ECQ will come from President Rodrigo R. Duterte, who may make an announcement this week, according to his close ally and former personal assistant Senator Christopher Lawrence “Bong” T. Go, in a radio interview yesterday.

Aside from updates on government measures to combat COVID-19, 2TradeAsia.com said investors will also be busy with the start of the annual stockholders’ meeting season.

Scheduled to hold their annual stockholders’ meetings this week are the different units of Ayala Corp.: AC Energy Philippines, Inc.; Ayala Land, Inc.; Bank of the Philippine Islands; and Ayala Corp. itself.

The brokerage said investors will wait for announcements in these meetings regarding business impact and future plans amid the COVID-19 pandemic. “[E]xpect more emphasis on forward guidance, as firms balance survival versus growth,” it said.

It also noted last week’s top gainers — Petron Corp., GT Capital Holdings Inc. and Jollibee Foods Corp. — were able to record increases despite having “no front-page worthy catalysts,” showing there are trading opportunities amid the market’s volatility.

“Set allocations for equities that are primed for similar recoveries once the smoke clears,” 2TradeAsia.com said. It put support for the PSEi at 5,500 and resistance at 6,000.

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