Market eyes US-China trade deal

Share prices are expected to move sideways this week as investors await the much-anticipated signing of the trade pact between the United States and China on January 15.

Analysts said the some key events, including the signing of the US-China trade pact and the tensions between US and Iran, were keeping investors on the sidelines.

Luis Limlingan, Regina Capital Development Corp. head of sales, said while the first phase pact was scheduled for signing this week, negotiations for the second phase was expected to be finalized after the US presidential elections.

BDO Unibank Inc. chief investment strategist Jonathan Ravelas noted that while the tensions between US and Iran had eased, investors remained on sidelines awaiting fresh leads to entice them back to the markets. 

“The week’s close at 7,776.77 highlights consolidation within the 7,700/7,900 levels. But risk lies at the break below 7,700, which paves the way for a test of the 7,514.05 levels, which could occur in the near-term,” Ravelas said.

The Philippine Stock Exchange Index last week slipped 0.8 percent to 7,776.77 while the broader All Shares Index declined 1.2 percent to 4,605.17.

Sectoral indices ended mixed with mining and oil posting the highest gain of 1.1 percent, followed by services which rose 0.5 percent and holding firms which added 0.5 percent.

The industrial sector registered the steepest decline, dropping 3.3 percent, property which fell 1.5 percent and financial which declined 0.9 percent.

Foreign investors were net sellers for the week by P1.2 billion, while the average daily value traded stood at P5.6 billion from the previous week’s average of P5 billion.

Weekly top price gainers were ABS-CBN Corp., which jumped 16.3 percent to P18.50; Manila Water Co. Inc., which rose 10.6 percent to P10.20; and DMCI Holdings Inc., which climbed 9.6 percent to P7.07.

Weekly top price losers were MacroAsia Corp., which slumped 14 percent to P14.18; GT Capital Holdings Inc., which declined 9 percent to P795; and JG Summit Holdings Inc., which fell 6 percent to P77.05.

Meanwhile, global stocks mostly drifted lower on Friday as investor appetite waned at the week’s end, US job creation disappointed and damaging new revelations weighed on Boeing.

Asian markets notched some gains for the day, however, as geopolitical tensions eased and a US-China trade deal increasingly looked like a done deal.

The US economy generated 145,000 new jobs in December, shy of a consensus forecast, while wage growth also disappointed, according to official figures released Friday.

London, Frankfurt and Paris also fell. Earlier, most Asian stock markets closed higher but investors struggled to maintain a rally triggered by easing US-Iran tensions the previous day.

Meanwhile, newly released emails showed employees at Boeing—the largest member of New York’s benchmark Dow Jones Industrial Average—mocking aviation regulators and the design of 737 MAX jets, which have been grounded after fatal crashes.

“It’s not that we’re seeing a big selloff as much as we’re seeing a lack of buyers heading into the weekend after some obvious geopolitical turmoil last weekend,” JJ Kinahan, chief market strategist at TD Ameritrade, told AFP. With AFP