Stockbroker COL Financial Group Inc. projects trades shown as the main index at the Philippine Stock Exchange, or PSEi, to hit between 7,500 to 8,250 towards yearend or by early next year as the economy continues to grow.
It said on Tuesday this were to happen without the so-called low base effect of the previous year.
But Juanis Barredo, COL chief technical analyst, said the main index would likely initially drop to the 6,650 to 6,400-point area before rising as high as 7,000 points.
“I think a lot of bullish signals have recently come out. We’ve seen it break through the downtrend line, we’ve seen it break through the 200-day moving average, we’ve seen it generate the Golden Cross. These present bullish signals it would be nice if one day we can rake the 7,200 area.”
Juanis Barredo, COL chief technical analyst
Personally, however, he leans toward the 7,500-point level around yearend: “So accumulate into these pullbacks. As we look for potentially higher index, something looking between 7,500 to 8,250”.
He noted the market typically performs weaker in February and March but subsequently accelerates in the succeeding months starting April.
April Lynn Tan, COL chief equity strategist, cited a number of compelling reasons why stock prices should continue to rise this year as inflation pressures ease although she also said consumer prices in the Philippines have yet to peak.
More favorable inflation is expected as the US Fed cuts rates and the Bangko Sentral ng Pillipinas matches the adjustments translating to a more competitive peso exchange rate.
Nevertheless, Tan acknowledged risks to the market’s performance this year, such as a hard landing of the US economy and inflation in the Philippines staying elevated, hurting consumer spending in the process.
Tan said the US Fed is seen as having successfully reined in inflation from its peak in 2022 to more favorable levels in recent months.
According to COL’s January investor sentiment survey, 54 percent anticipate continued growth of the main index, which is higher than the 33 percent outcome in the July survey last year.
A majority of investors still plan on boosting their stock portfolios, COL said.
