THE STOCK MARKET is seen moving sideways in the upcoming trading week amid rising coronavirus disease 2019 (COVID-19) cases in the country.

On Thursday, the benchmark Philippine Stock Exchange index (PSEi) fell 36.72 points or 0.6% to end at 6,005.40, while the broader all shares index dropped 18.30 points or 0.51% to 3,573.06.

Markets were closed on Friday for Ninoy Aquino Day.

Philstocks Financial, Inc. Research Associate Claire T. Alviar said in a mobile phone message that the market is expected to move sideways during the trading week amid a lack of catalysts.

Ms. Alviar said the narrative remains the same: rising COVID-19 cases and the waiting game for the development of a vaccine against the said disease.

“But so far, after the implementation of modified enhanced community quarantine in Metro Manila and as it reverted to general community quarantine, there is no risk yet of imposing stricter lockdown measures since the government is saying that the Philippines cannot afford to have stringent community quarantine,” she said.

Online brokerage 2TradeAsia.com said in a market note that economic policies will be a key factor for the market in the next few weeks, such as the signing of the new Bayanihan to Recover as One Act or Bayanihan II.

“The short trading week saw a see-saw battle between bulls and bears, as gains from the government’s quarantine easing were erased later in the week, when bears took helm,” 2TradeAsia.com said.

“At the 6,000 level, the PSEi is back to where it was just prior to the start of the second quarter earnings season in late July. Barring further black swan events plus a steady stream of fiscal support, the opinion that fundamental drivers could only improve relative to the second quarter is not unreasonable at all,” it added.

The Congress on Aug. 20 allotted a total of P165.5 billion under Bayanihan II to fund the government’s fight against COVID-19 and boost economic recovery.

Some P140 billion has been approved for funding while the remaining P25.5 billion will serve as standby funds.

2TradeAsia.com placed the market’s immediate support for the upcoming week at the 6,000 level, secondary support at the 5,800 level and resistance at 6,250.

“Due to lack of strong fresh leads, trading range would be between 5,700 and 6,100,” Philstocks’ Ms. Alviar said.

Meanwhile, a jump in US business activity and home sales helped push global equities and the dollar higher on Friday, counteracting earlier stock declines in Europe.

The Dow Jones Industrial Average rose 190.60 points or 0.69% to 27,930.33. The S&P 500, which broke out of its bear market on Tuesday by recouping pandemic-related losses, powered up 11.65 points, or 0.34%, to 3,397.16. The tech heavy Nasdaq Composite added 46.85 points, or 0.42%, to 11,311.80. — R.M.D. Ochave with Reuters

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