Metro lockdown to weigh on stocks

Share prices are expected to trade sideways this week with a downward bias following the government’s announcement placing Metro Manila and neighboring provinces back under stricter quarantine measures for a period of one week.

Analysts said investors’ appetite would also stay anemic as they take a cautious stance during the shortened trading week.

Financial markets will be closed on Thursday and Friday in observance of the Holy Week.

Analysts said the government’s move to place the National Capital Region and other nearby provinces back under enhanced community quarantine in order to curb the recent spike in COVID-19 cases could further delay the recovery of the domestic economy.

“Beyond, 8,000 new cases per day will signal an aberration in the recovery curve for COVID-19 cases and may necessitate some hard counters from the government in order to rein back further damage to public confidence,” online brokerage firm 2TradeAsia.com said.

The Philippine Stock Exchange Index last week rose 1.7 percent to 6,55.63 points on bargain hunting. The broader All Shares Index also climbed 1.5 percent to 3,967.79.

All sub-indices ended in the green, led by property which gained 2.9 percent, services which advanced 2.4 percent and mining and oil added 1.4 percent.

Foreign investors were net sellers for the week by P2.55 billion while the average daily value traded rose to P9 billion from the previous week’s P8.24 billion.

Weekly top price gainers included Puregold Price Club Inc., which jumped 8.6 percent to P40.20, DMCI Holdings Inc., which advanced 8.6 percent to P5.43, and San Miguel Corp., which climbed 6.4 percent to P123.

Weekly top price losers were 2GO Group Inc., which sank 9.7 percent to P8.46, Phoenix Petroleum Philippines Inc., which declined 5.4 percent to P11.16, and Cebu Air Inc., which dropped 5.2 percent to P44.30.

Global stocks, meanwhile, rose Friday after German, UK, and US economic data provided a brighter outlook for major economies worldwide. 

London, Paris, and Frankfurt extended a global rally heading into the weekend, buoyed by upbeat UK retail data and strong German business sentiment.

US stocks were helped by government data that showed no sign of rising inflation in February, soothing fears that the world’s biggest economy could overheat. Both the Dow and S&P 500 closed the week out at all-time highs.

Oil prices also bounded higher at the end of a rollercoaster week.

“Economic recovery optimism is boosting equity indices higher as we head towards the weekend,” said OANDA analyst Sophie Griffiths.  

“Better-than-forecast US initial jobless claims, rebounding UK retail sales and stronger-than-expected German business sentiment are boosting” markets, she added.

In the United States, a Commerce Department report also said that prices grew less than expected at 0.2 percent in February, easing concern that government stimulus measures would cause inflation and force the Federal Reserve to raise interest rates sooner than expected.

“This period of hesitation and rotation going on since mid-February is coming to an end,” said Karl Haeling of LBBW, who expects a strong April for stocks. With AFP