Last week
Share prices rebounded last week, with the main index returning to the 6,600-point level, as corporates had started their window-dressing activities.
The benchmark Philippine Stock Exchange index (PSEi) surged 475.26 points to close at 6,674.51 points. This is the strongest week of the main index for the year so far.
The main index started the week down, but it surged all throughout the week, rising the most on Wednesday and Thursday when corporates did their window-dressing activities ahead of the closing of the month.
Foreign investors, which cornered 60 percent of the overall trade for the week, were still net sellers at P7.2 billion.
Average daily trading value reached P9.95 billion, with Thursday having the biggest volume at P23.67 billion.
All other subindices ended in the green led by the broader All Shares index that gained 204.75 points, the Financials index rose 45.16 to 1,417.63, the Industrial index climbed 411.52 to 8,989.64, the Holding Firms index surged 583.87 to 6,728.41, the Property index soared 272.79 to 3,273.72, the Services index added 57.15 to 1,510.84 and the Mining and Oil index added 105.41 to 9,416.64.
For the week, gainers led losers 152 to 68 and 29 shares were unchanged.
Top gainers were Grand Plaza Corp., PTFC Redevelopment Corp., Discovery World Corp., Cebu Landmasters Inc., JG Summit Holdings Inc. and Imperial Resources Inc.
Top losers were Greenergy Holdings Inc., Vulcan Industrial and Mining Corp., LMG Corp., Manila Mining Corp. A shares, Lepanto Mining Co. A and B shares and National Reinsurance Corp. of the Philippines.
This week
Trading is expected to be volatile this week as the government will announce the new quarantine classification of the busiest economic part of the country for June.
Japhet Louis O. Tantiangco, senior research analyst at Philstocks Financials Inc., said investors will be watching out for the decision on the new classification status of the National Capital Region and nearby provinces, which account for a chunk of the country’s GDP.
“Developments on the Bayanihan to Arise as One (Bayanihan 3) Bill are also expected to be monitored as it is set up for a third and final reading at the House of Representatives. Further progress on the passage of the bill may spur market optimism. Setbacks on the passage, however, are expected to lead to the contrary,” he said.
The local market may also take cues from the upcoming economic data this week including the IHS Markit Philippines Manufacturing PMI and the consumer price index data for May.
“The PSEi’s immediate support now is seen at the 6,600 level followed by the 200-day exponential moving average which closed last week at 6,584.98. Its immediate resistance, on the other hand, is seen at the 6,900 level,” he said.
Monde Nissin Corp., the country’s biggest initial public offering so far, will hold its maiden listing on the Philippine Stock Exchange on June 1, which could funnel funds away from the market.
The May inflation figures will be released on June 4, which could reveal the corresponding response of the central bank to counter rising prices.
“Sustaining accommodative stance is nothing short of expected, but an inflation back to 2 to 4 percent range could be the extra push that margin-battered issues need,” 2TradeAsia said in its research note.
Stock picks
Broker Regina Capital Development Corp. advised investors to take their position on the stock of BDO Unibank Inc. as it moved in the opposite direction of the main index and got pulled below its key long-term moving average and support at P99.30.
“To be more specific, BDO settled at its session low of 98.50, reflecting a -2.86 percent or 2.90 points drop in a session. This drove the technical indicators to have raging bearishness,” it said.
“Given that BDO is now trading at a discount from all of its key moving average, investors may opt to start taking positions near its new support at P97.50.”
BDO shares closed Friday at P101.80 apiece.
Meanwhile, the broker recommended buying when its support price holds on the stock of International Container Terminal Services Inc. (ICTSI).
“Judging the chart of ICT, it appears as if it’s taunting for a bearish reversal after days of consolidating sideways. In the near term, market participants may want to wait and see if support at P137.60 will hold before making their next move. Meanwhile, ICT’s resistance is at P140,” the broker said.
Shares of ICTSI closed last week at P146.40 apiece.