Stocks to trade sideways with upward bias this wk

MANILA, Philippines - Local share prices are expected to be on a merry mood this week as Christmas month officially kicks off.

Analyst said stocks would likely drift sideways on the next five trading sessions but with an upward bias following Friday’s positive finish.

Justino Calaycay Jr., analyst at Accord Capital Equities Corp., said the market proved its mettle Friday as it was able to immediately shake-off the shock of the country’s relatively poor economic performance.

The Philippine Stock Exchange index (PSEi) was able to shatter its previous record for the year last Wednesday but fell immediately the following day on the back of a disappointing third quarter economic growth.

Still, the PSEi managed to end at 7,294, up 18 points or 0.25 percent week-on-week.

“Moving into December, most stocks may already be fully priced while discounting of full-year results begins three months down the line. Thus the major impetus for the month will be anticipating a Santa Claus rally—particularly with the relatively short trading month ahead,” he said.

Calaycay said November inflation numbers will be an interesting data to watch out for this week for investors.

“Given the slower growth, the CPI level should give an indication on the future policy action by the BSP,” he said.

For F. Yap Securities investment analyst Jason T. Escartin, the entry of two new firms in the local bourse this week is also seen to help in dictating the mood of the local market.

Phoenix Semiconductor Philippines Corp will be the fifth company to list in the PSE this year with its listing date scheduled today while technology firm Xurpas Inc. will be the sixth with its listing tomorrow.

“Investors will monitor the debut of newcomers Phoenix Semiconductor  and Xurpas, to gauge reception on tech-related shares,” Escartin said.

“With several industrialized economies on the mend, extended stimulus policies are likely to be embraced across the region.  This should keep borrowing costs tame, until fiscal and monetary policy makers are convinced recovery has taken hold for economies such as the US, Europe, Japan & China,” he added.