Philippines share prices are expected to trade around current levels in the coming week, with investors uncertain after a sustained period of political tension and concerned by a possible hike in interest rates, dealers said.
They said the immediate crisis, sparked by opposition calls for President Gloria Arroyo to stand down, may have passed but many loose ends remain unresolved, among them implementation of an expanded value-added tax (VAT) which the government says is needed to avoid a looming fiscal crisis.
The tax was recently upheld by the Supreme Court as constitutional but there is increasing opposition in Congress to its introduction now given the possible fallout on inflation and popular discontent.
For the week to September 16, the composite index gained 27.03 points or 1.43 percent to 1,909.80 points.
Average daily volume fell to 540 million shares but average daily value rose to 1.0 billion pesos (17.8 million dollars) from 674 million shares worth 852 million pesos a week earlier.
"The market will just consolidate near the 1,900" level, said Astro del Castillo of First Grade Holdings.
"It can even go down due to concerns about the expanded VAT and the possibility of a rate increase," he added.
"The market is expected to shift to a consolidation mode in the coming sessions," AB Capital Securities said in a note to clients.
"The lack of positive domestic leads and the prospect of higher interest rates will provide a negative backdrop for the market," it added.
The central bank has indicated that a tightening in monetary policy is likely in the near term after inflation rose faster than expected in August.
It last raised its benchmark rates in April, its first time in five years. The overnight borrowing rate currently stands at 7.00 percent while the overnight lending rate is at 9.25 percent.
The Philippine peso was at 56.117 to the dollar as of Friday afternoon.