THE Philippine stock exchange index closed at 7,977.12 points this week after briefly touching the 8,000-point level. The index has been hovering around the 8,000 region for weeks, with many investors still waiting for the Christmas season to kick off before putting their capital into new stock investments.
Stock broker and technical analyst Hernan Segovia observed that most of the positivity in the index was due to the peso’s strength against the dollar as well as stable global oil prices.
“A stronger peso equates to a better market perception,” Segovia said. “And I think that the dollar to peso rate is right around 50.75, and it’s going strong as the weeks move forward.”
According to Segovia, the peso has beaten investor expectations for the peso this year. Many financial experts had expected that the dollar to peso rate would fall to the P58 to $1 in 2019. Instead, the country’s currency seems to be appreciating considerably versus the dollar.
Furthermore, Segovia also attributes the index’s stability to oil prices, which along with the peso’s strength, is helping to stabilize inflation and shore up demand ahead of the holidays.
“Global prices of oil are slowing down. Right now, it’s trading to the $52,” Segovia said. “So we’re likely to prop up above 8,000 for the rest of the year.” Segovia expected the stock market to be fairly stable and healthy for the rest of the year, although he did not expect any spectacular gains in the coming months./PN
