The benchmark Philippine Stock Exchange index (PSEi) could enter another round of consolidation after energized bulls stepped in and reversed a recent market slump.
Last week, the PSEi jumped 3.85 percent to end at 6,624.79 as easing inflationary pressures improved the outlook for the global economy.
“Some traders are expected to take profits given the good run-up in stock prices, but we are also likely to see investors buy the dips as they position ahead of President Marcos’ State of the Nation Address and the US Federal Reserve’s policy rate announcement later this month,” Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., said in a note to investors.
He said investors would also be closely monitoring foreign fund flows “as sustained net foreign buying would be crucial for the market’s strength.”
“The index may look to retest the durability of the 6,530 to 6,580 support zone. If prices hold above those levels and close atop 6,600 by the end of the week, the market could build a base for further bullish action heading toward the end of July,” he added.
Michael Ricafort, chief economist at the Rizal Commercial Banking Corp., said the PSEi was up 2.4 percent since the start of 2023 due to gains from the past week.
He pegged the next major resistance level at 6,730 to 6,830 while major support could be found at 6,250.
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