PHL shares may decline amid Trump tariff watch
PHILIPPINE SHARES could decline this week as uncertainty surrounding the Trump administration’s trade policies continues to affect sentiment.
On Friday, the bellwether Philippine Stock Exchange index (PSEi) rose by 0.12% or 7.93 points to 6,147.44, while the broader all shares index inched up by 0.12% or 4.59 points to 3,666.95.
Week on week, however, the PSEi dropped by 1.9% or 119.31 points from its 6,266.75 finish on March 21, declining for a third consecutive week.
“The local bellwether index held steady at its trading range, primarily pushed-and-pulled by interest rate-related headlines,” online brokerage firm 2TradeAsia.com said in a market note.
“The local market had a bearish week as it went below its 50-day exponential moving average. Its MACD (moving average convergence/divergence) line has crossed below the signal line, implying downward momentum in the short term. Trading has been anemic, showing weak market confidence,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
For this week, the market will likely keep an eye on the Trump administration’s tariff plans, he said.
“We still see global economic outlook concerns caused by the US’ protectionist stance posing downside risks to the local bourse. In line with this, investors are expected to watch out for the implementation of the US’ upcoming reciprocal tariffs to see if there will be any adjustments. Any new tariff announcement from the US government is expected to pull the local bourse lower,” Mr. Tantiangco said.
US President Donald J. Trump on Friday said that he was open to carving out deals with countries seeking to avoid US tariffs but those agreements would have to be negotiated after his administration announces reciprocal levies on April 2, Reuters reported.
“On a positive note, hopes that the BSP (Bangko Sentral ng Pilipinas) will cut rates in their April meeting may help lift sentiment. Investors are expected to watch out for our March inflation due on Friday as this will give clues on the BSP’s next policy moves,” Mr. Tantiangco added. He said the PSEi could move from 6,000 to 6,400 this week.
A BusinessWorld poll of 17 analysts conducted last week yielded a median estimate of 2% for the March consumer price index.
If realized, this would be a tad slower than the 2.1% in February and the 3.7% clip in the same month a year ago. This would also be the lowest monthly inflation in six months or since the 1.9% print in September.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort placed the PSEi’s support at 6,000 and resistance at 6,275-6,530.
2TradeAsia.com put support at 6,000 and resistance at 6,400. “Sentiment remains relatively fragile above 6,300 as upcoming inflation data and central bank policy rhetoric remain at the forefront, ahead of any mid-year adjustments at the corporate earnings level.” — Revin Mikhael D. Ochave
