The actions of PH will be haunted by the Covid
New concern over the 2019 global coronavirus disease (Covid-19) pandemic situation is hampering the local stock exchange this week of trading.
Japhet Tantiangco, senior research analyst at Philstocks Financial Inc., expects a downward bias for the local market due to the risk posed by the Delta variant, which could weigh on the global economic recovery
The health ministry last week reported two more cases of the Delta variant in the country, bringing the current total to 19.
âDetection of more cases with said variant in the Philippines could reinforce negative sentiment,â Tantiangco said.
Philippine Stock Exchange offices at BGC, Taguig City. PHOTO BY ENRIQUE AGCAOILI
He added that investors would also remain cautious pending the release of second quarter corporate results and would also monitor developments in oil prices and the local currency.
“A further rise in oil prices and / or a further depreciation of the peso should have a strengthening effect on our inflation, which in turn would weigh on the local economy,” Tantiangco explained.
The peso’s depreciation could also discourage foreigners from investing in the Philippines, Tantiangco noted.
Foreign funds continued their outflow on Friday as the market recorded a net foreign sale of 1.13 billion pesos.
Tantiangco has set the trading range from 6,600 to 6,900.
Diversified Securities Inc. trader Aniceto Pangan said the main index could continue to be volatile, with an index range of 6,600 and 7,000, as the Covid-19 variants serve as “hurdles” to the reopening of the world economy.
Last week, the Philippine Stock Exchange index fell 1.3% or 90.07 points to end at 6,834.92 on Friday amid concerns over the Covid-19 situation as the number of cases increased abroad.
Among the main catalysts that the chief economist of Rizal Commercial Banking Corp. Michael Ricafort sees for the market this week also the trend of new cases of Covid-19.
Ricafort also noted that the release of major economic data, including balance of payments, gross international reserves and Filipino workers’ remittances abroad, will also affect investor sentiment.