Local markets’ resiliency shines through as trading week closes

“The future’s market was already making a bit of a comeback with this development,” he said. (Pixabay)

MANILA — News of a one-on-one talk between US President Donald Trump and China President Xi Jinping at the G20 meeting in Buenos Aires next month, possibly ending the trade standoff, enabled local stocks to end the week with gains and the Peso to sustain its firmness.

The Philippine Stock Exchange index (PSEi) returned to the 7,000-level after dropping to 6,800-level Thursday. It rose by 1.75 percent, or 120.39 points, after a two-day decline and finished the week at 7,004.77 points.

The broader All Shares is up by 1.43 percent, or 60.55 points, to 4,301.80 points.
Mining and Oil posted the highest uptick of 2.63 percent and was tracked by the Industrial, 2.23 percent; Services, 1.90 percent; Property, 1.65 percent; Holding Firms, 1.59 percent; and Financials, 1.01 percent.

However, volume was thin at 636.86 million shares amounting to PHP5.28 billion.

Gainers led losers at 127 to 56 while 47 stocks were unchanged.

LandBank market economist Guian Dumalagan said the PSEi mirrored other Asian bourses “on a possible Xi/Trump meeting that would possibly end the trade tension.”

“The future’s market was already making a bit of a comeback with this development,” he said.

He added that investors are also awaiting updates regarding a report that the US Treasury Department staff has advised Secretary Steven Mnuchin that China is not manipulating the yuan as the current US government prepares a report on foreign currencies.

Meanwhile, A&A Securities head of research Jun Calaycay told the Philippine News Agency (PNA) that recovery of the main equities gauge Friday “is the market telling us that 6,900 is a strong support line.”

He said PSEi’s positive end for this year also shows that “the previous day’s action was, by and large, a sentiment-driven reaction to the Dow’s 800-point slide the night prior.”

“The news out of China could’ve complemented and provided an additional reason for investors to go cherry-picking,” he said.

“We are hoping that the momentum will carry over to next week, barring any unforeseen and unwanted risks that may or may not emerge over the weekend,” he added.

Also, the peso ended the week at 54.13 from 54.18 Thursday, which was attributed partly to the news about the possible Trump-Xi meeting next month and the slide of Wall Street Thursday.

The local currency opened the day at 54.1, better than the 54.22 a day ago and this was traced to risk-off sentiment in the US and the weakening of the US dollar.

It further improved to 54.03 but also slipped to 54.14, resulting in an average of 54.081.

Volume of trade reached USD776.1 million, higher than the USD665 million a day ago.

The currency pair is seen to trade between 54.00 and 54.40 next week.