By Denise A. Valdez

LOCAL SHARES are seen to climb this week as investors expect a recovery in some sectors with the easing of rules for areas under enhanced community quarantine (ECQ) and general community quarantine (GCQ).

The benchmark Philippine Stock Exchange index (PSEi) rose 56.74 points or 1% to 5,700.71 on Thursday. This sustained the main index’s weekly climb for a second straight week, recording an increase of 4.3% last week.

Value turnover slipped 1.4% to an average of P4.95 billion, while net foreign selling grew 8.4% to an average of P669.95 million.

The local market was closed on Friday in observance of Labor Day.

“Prospects of modified lifting of ECQ provided hope for equities players, pushing the PSEi 235 points higher to 5,700,” online brokerage said in a market note.

“Part of the positive mood was aided by the launch of ‘Operation Warp Speed’ in the US, that aims to gather private pharmaceutical firms to cut the development time for a vaccine on COVID-19 (coronavirus disease 2019) by as much as eight months,” it added.

The government issued last week its updated guide on areas observing GCQ starting May 1, which will allow the resumption of operations of some non-essential establishments such as malls and shopping centers.

The mood of investors this week will remain focused on positive developments in the COVID-19 pandemic, said.

“With a structured approach on mass testing, listed firms are emerging with clearer focus from the ECQ, specifically to their resumption trajectory, this time, fortified with risk contingency measures,” it said.

“(P)articipants should get a picture of how things would unfold for the ECQ-GCQ transition mode, with virtual briefings in place from select stocks,” it added.

Scheduled to hold their briefings this week are Metropolitan Bank & Trust Co.; Cemex Holdings Philippines, Inc.; Globe Telecom, Inc.; Metro Pacific Investments Corp.; International Container Terminal Services, Inc.; and Integrated Micro-Electronics, Inc.

For Philstocks Financial, Inc. Research Associate Piper Chaucer E. Tan, developments in Wall Street will also push activity in the local bourse, after White House signaled new tariffs on China because of its handling of the coronavirus crisis.

“I think the market catalyst for this week is development in the US markets, how it will react to the coronavirus tariffs. These tariff issues have (arisen), and as we know, these tariffs affect market in a negative way,” he said in a text message yesterday.

He also said the market may be on wait-and-see mode, as seen in the consolidated movement of the PSEi in the past two weeks. “I expect this week to be within the (5,440-6,000) range also,” Mr. Tan said. is putting immediate support for the PSEi within 5,500-5,600 and resistance within 5,800-5,900.