FOREIGN capital outflows caused pain to the Philippine stock market last week, a technical analyst and trader said.
The flight of foreign capital caused the market to dip below the 7,500 level last Thursday but fortunately closed the week above the 7,700 level, according to Hernan Segovia.
“Most of the funds going out of the Philippine market right now are foreign. So the only ones left buying the market is us,” Segovia said. “So the market will range from here and until it recovers to the 8,000 level.”
Another reason is that there are talks that the market is “overheating” because the Philippines is the “worst performing market” this year, Segovia pointed out.
The bad situation last week was isolated in the Philippine market while the regional markets remained stable, he said.
Presently, Segovia said, there are buying opportunities for those willing to risk entering a weakened Philippine stock market.
“Selected blue chips are quite good,” he said, “especially those that have fallen prey to panic selling.”
Segovia added: “Most are shying away from those stocks that have high foreign outflows. Local investors are focusing on those stocks that have momentum.”/PN
