COL Financial believes that the PSEi will soon break above the 8,100 mark. This forecast is mainly due to the improving global economic outlook, the approval of the much awaited tax-reform bill and the diminishing headwinds facing numerous sectors. The PSEi has already tried to breach the 8,100 level the passed month and has failed to break above 8,100 twice already. But with the given conditions, the PSEi seems ripe to finally breach the 8,100 level anytime soon.
COL Financial also lowered it’s risk premium assumption by 50 basis points to 5.0% after raising it last October, 2015. This simply means that the forecasts about the PSEi are more accurate and are more likely to be achieved. The good news here is that COL Financial is forecasting the PSEi to be at the 8,700 level by the end of 2017.
A word of caution though is that there is a possibility that the PSEi would go through a correction in the short-term, at the same time, historically, August is usually a down month for the market.
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