Trade deal progress to buoy PSEi
Credit to Author: Tyrone Jasper C. Piad| Date: Sun, 15 Dec 2019 16:14:07 +0000
Investors might still cheer on the recent trade deal progress between the United States and China this week.
Last week, the benchmark Philippine Stock Exchange index (PSEi) finally returned to 7,800 level after trading sideways in the previous days as the world’s largest economies were showing signs to conclude a trade truce.
Philstocks Financial Inc. research associate Claire Alviar is expecting the same narrative this week. “If the US-China trade narrative remains in a positive tone, then the rally will continue,” she said.
The US and China has been working on the phase one deal, which covers the banking and farming industries, for a few months now.
It has faced delays, prompting investors to sell off their positions, but the recent announcement provided some relief for the local bourse.
The long-standing trade dispute between Washington and Beijing began over a year now.
But Alviar said that there was still risk of volatility as the PSEi only gained nearly 1 percent last week and average daily trade has remained “weak.”
Meanwhile, brokerage firm 2TradeAsia said: “Expect volatile trades this week, given the final five-day trading session for 2019.”
It pegged the immediate support at the 7,700 level and resistance at the 7,950 to 8,000 range.
On Friday, PSEi climbed by 1.76 percent or 136.56 points to end at 7,877.63 while the wider All Shares added 1.38 percent or 63.32 to finish at 4,662.07.