The market is expected to monitor developments in the global coronavirus disease 2019 (Covid-19) pandemic, vaccines for the virus, and local policy changes.
The Philippine Stock Exchange index (PSEi) finished the first trading week of the year in the green as it rose 2.39 percent or 170.27 points to close at its intraday high of 7,289.88 on Friday, following the ascend of markets in the United States.
Research from 2TradeAsia.com said the market briefly breaking below 7,000 before bouncing back towards resistance of 7,300 on hefty turnover of P11 billion is a “technical indication that momentum is skewed towards the belief that some semblance of ‘renaissance’ is still in the cards.”
“In the interim, monitor policy changes for February and March as new strain headlines and need to fully reopen are balanced,” it continued.
2TradeAsia.com sees immediate support at 7,100, secondary at 6,950, while resistance is at 7,500 to 7,700.
Diversified Securities Inc. trader Aniceto Pangan, meanwhile, sees the sustained positive momentum prevailing in local shares for the week as President Donald Trump has conceded to President-elect Joe Biden.
For his part, Rizal Commercial Banking Corp. chief economist Michael Ricafort noted upcoming developments, which could affect the economy and financial markets.
This includes progress on legislative reform measures like the Corporate Recovery and Tax Incentives for Enterprises Act or Create and Financial Institutions Strategic Transfer or FIST bills, updates on the development of Covid-19 vaccines, and the trend in new pandemic cases locally.
Ricafort also sees the new coronavirus variant to be an offsetting risk factor and whether or not the current Covid-19 vaccines being developed are effective against it.