Stocks to continue tracking Covid cases

By Faye Almazan | The Manila Times
January 10, 2022


A downward bias is still seen for the Philippine bourse this trading week as local pandemic cases continue to register higher.

Last week, the benchmark Philippine Stock Exchange index (PSEi) lost 1.05 percent or 74.41 points to finish at 7,011.11 on Friday amid the rapid rise in daily Covid-19 cases locally.

Philstocks Financial Inc. senior research analyst Japhet Tantiangco expects the local market’s bias to still be slanted to the downside due to the country’s pandemic situation.

“A continuation of this trend is expected to further escalate worries over the possibility of stricter restrictions being implemented in the country, which would hurt our economy. This in turn may pull down the local bourse,” Tantiangco explained.

The surge in the number of cases prompted the government to place several areas in the country under the Alert Level 3 status until January 15, including the National Capital Region.

Tantiangco added that developments abroad could also inject more downward pressure to the main index this week as “US bond yields have risen following the Federal Reserve’s hawkish signals in their latest minutes of the meeting.” Regina Capital Development Corp. Managing Director Luis Limlingan likewise said the market’s focus for the week would be on the number of Covid-19 cases in the country or if these remain elevated.

Chartwise, Tantiangco sees the market to still test its 7,000 to 7,100 support range, while next support is set at its 200-day exponential moving average, which is currently at 6,942.75.

Immediate resistance, meanwhile, is seen at its current 10-day exponential moving average of 7,129.04, according to Tantiangco.