PHILIPPINE shares may continue their downward trend this week as the country reports more coronavirus disease 2019 (COVID-19) infections, raising fears that strict restrictions would be extended.
The Philippine Stock Exchange index (PSEi) declined by 37.46 points or 0.58% to finish at 6,378.07 on Friday, while the broader all shares index lost 20.22 points or 0.51% to end at 3,927.19.
Week on week, the benchmark index shaved off 116.74 points from its 6,494.81 close on April 16.
“The market suffered more losses [last] week as more and more investors are closing positions on expectations that the economy will take longer to recover,” AAA Southeast Equities, Inc. Research Head Christopher John J. Mangun said via e-mail.
“The spike in new COVID-19 cases, locally and abroad, has caused tighter restrictions and fears of financial hardships,” Mr. Mangun added. “The slow pace of inoculation is another reason why investors are turning increasingly bearish.”
He added that developments this week will be “extremely important” for the market.
“We may see an extension of the current measures as the number of new cases have not shown any improvement. Further tightening of mobility will be a disaster for the economy as well as the market,” Mr. Mangun said.
The National Capital Region and nearby provinces have been under strict lockdown for the past month as coronavirus cases surged, with a decision on an extension or easing expected by April’s close.
The Health department on Saturday reported 9,661 new COVID-19 infections, which brought the country’s tally to 989,380. Active cases stood at 89,485. The department said on Saturday that more vaccines were set to be distributed to local government units yesterday.
“If we see a significant decline from this, then it may fuel optimism in the market. A surge from the said daily average COVID-19 cases may lead to otherwise, however,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message on Sunday.
“Investors are [also] expected to look towards the [first-quarter] 2021 corporate earnings reports for clues on how companies are faring amid the lingering challenges brought by the COVID-19 pandemic,” Mr. Tantiangco added.
He said he expects the PSEi to end between the 6,370 to 6,400 range, with support pegged at 6,100.
“Market will continue its downtrend due to [sustained] high level of infection rates at four digits or above coupled with slow vaccine rollout that may serve as hindrance for the government to normalize the economic condition,” Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said in a mobile phone message on Saturday. — Keren Concepcion G. Valmonte
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