Trading at the Philippine Stock Exchange is expected to remain volatile this week, as investors continue to be wary about the impact of Donald Trump’s victory in the US presidential race on the domestic economy.
F. Yap Securities said jitters caused by Trump’s win could spill over this week as the Philippines could remain the least favored market until Trump’s economic plans and policies were clearly articulated.
“Looking into Philippine equities more closely, property has been heavily battered on fears that BPOs [business process outsourcing companies] may pull out and hurt the office leasing revenues of property companies,” F. Yap Securities said.
“On top of this BPO issue, there are concerns that remittances from overseas Filipinos may drop sharply as investors take Trump’s campaign talks like bringing back jobs to the US and prioritizing Americans in job offers at face value,” the broker said.
“While we find these fears way exaggerated, negative sentiments may still outweigh the strong fundamentals,” it said.
Analysts said with earning season coming to an end, investors’ focus had shifted to the possible US rate hike in December.
A positive factor that could boost the market this week is the release of the third-quarter gross domestic product growth figure. Economists see third-quarter growth at 6 percent to 7 percent.
The Philippine Stock Exchange index, the 30-company benchmark, is expected to trade between 6,900 and 7,200 points this week.
The bellwether dropped 3.5 percent last week to close below the 7,000-point level. It settled at 6,975.09 on Nov. 11, while the broader all-share index went down 2.4 percent to 4,220, as investors focused on result of the US elections.
The PSEi was up by only 0.3 percent since the start of the year.
Except for the mining and oil index, which climbed 2.7 percent, all other indices ended in the red led by holding firms which declined 4.4 percent, property which went down 3.1 percent and services which lost 2.3 percent.
Foreign investors were net sellers last week by P3.8 billion, as total foreign selling hit P21.92 billion while foreign buying amounted to P18.1 billion.
Top gainers last week were mining companies Atlas Consolidated Mining and Development Corp. which advanced 27.2 percent to P5.09, Nickel Asia Corp. which rose 11.4 percent to P7.73 and Benguet Corp. ‘A’ shares which climbed 10.3 percent to P2.36.
Heavy losers were Globe Telecom Inc. which fell 14 percent to P1,490, Ayala Corp. which dropped 9.5 percent to P750 and GT Capital Holdings Inc. which went down 8.7 percent to P1,263.
