June 22, 2024

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Investors to remain cautious as war continues

2 min read

INVESTORS are expected to remain cautious and stay on the sidelines this week as they continue to monitor developments in the Middle East and how they will affect the global economy.

The benchmark Philippine Stock Exchange index (PSEi) went down by 76.26 points or 1.22% to close at 6,142.90 on Friday, while the broader all shares index shed 36.37 points or 1.08% to end at 3,329.42.

Week on week, the PSEi fell by 13.33 points or 1.97% from its close of 6,266.34 on Oct. 13.

“The failure of the index to hold above the important 6,150 support level last Friday will shift the tone of trading towards caution this week,” China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.

“Increasing US Treasury yields and the volatile Israel-Hamas conflict have dampened risk sentiment as investors wrestle with tight monetary policy, upward oil price pressure, and geopolitical tension,” Mr. Colet added.

The market is expected to be in a generally cautious mood due to the war, online brokerage 2TradeAsia.com likewise said.

“As geopolitical tensions increase, confidence in future fundamentals decrease — and so do asset prices. After all, risk aversion is the human tendency to switch to more certain outcomes to avoid loss,” 2TradeAsia.com said in a report.

The war has compelled investors “to reevaluate their strategies and shift their focus from riskier assets to safer investments,” Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said in a Viber message.

Israel pounded southern Gaza with air strikes early on Sunday and said it would intensify its attacks in the enclave’s north, as Washington pledged more air defences to the Mideast in response to recent attacks on US troops in the region, Reuters reported.

Palestinian media reported at least 11 Palestinians were killed in an Israeli strike in the southern Gaza city of Khan Younis, and that Israel was striking the southern city of Rafah.

The strikes…

BusinessWorld

2023-10-22 09:00:52

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