By Denise A. Valdez, Senior Reporter

PHILIPPINE SHARES may rise this week on the back of companies’ reports on their third quarter corporate earnings and the release of manufacturing and inflation data.

The bellwether Philippine Stock Exchange index (PSEi) added 74.61 points or 1.19% to close at 6,324 on Friday, declining by 160.06 points or 2.5% on a weekly basis.

Value turnover jumped 41% to an average of P11.97 billion, as net foreign buying grew more than 10 times to an average of P392.86 million.

For this week, the primary local catalysts would be corporate earnings and macroeconomic data, Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said.

“Investors are expected to take cues from the upcoming preliminary third quarter/nine months corporate reports,” he said in a text message. “Signs of improvements in corporate earnings (if 3Q earnings contraction eases compared to 2Q) could give the local market a boost.”

Also scheduled this week are the release of October inflation data and September trade report by the Philippine Statistics Authority, and October factory activity in the Philippines by IHS Markit.

Aside from local news, investors will also monitor overseas events slated for the week, particularly the US elections on Nov. 3.

“After the Halloween long weekend, markets will be met by headlines coming from the US elections,” online brokerage said in a market note.

“Note that unlike its iterations in previous years, the 2020 elections outcome may not be announced on the same day (made complicated by early voting and mail-in ballots); this exacerbates speculation, and with it, higher volatility,” it added.

Any shift in political power commonly causes jitters among investors, said. But particular to this year’s elections would be the effect of the results on US-China trade relations, Iran oil sanctions and the coronavirus stimulus bill.

“As many other concerns are tied to this year’s US showdown, funds may remain guarded, until the terrain becomes less uncertain—worst-case, wait until the actual swearing off into office of a new US president (if Joe Biden wins) or reelection (if Donald Trump wins) by January 2021,” it said.

“Lingering worries offshore amid the surge in COVID-19 cases and the reimplementation of social restrictive measures primarily in Europe could serve as a downside risk to the market,” Philstocks Financial’s Mr. Tantiangco added.

But for, the pullbacks after the PSEi’s recent rally to the 6,000 level are “common, often even desired, as these signal more sustainable ascents.”

The brokerage is putting immediate support for the PSEi within 6,150-6,200 and resistance within 6,500-6,700. Mr. Tantiangco of Philstocks expects support within 6,000-6,100 and resistance at 6,600.