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MANILA, Philippines - The stock market is expected to take a wait-and-see stance this week as investors remained on the sidelines on the back of renewed expectations of a US interest rate hike.

Analysts said market's low of 7,312.18 last week could mean a near-term bottom and that the benchmark Philippine Stock Exchange index (PSEi) may already be on its way to recovery.

It was the first time again that the local stock barometer closed below the 7,500 level since May 27.

"However, prices rebounded toward the end of the trading week to close at 7,389.30," said Jonathan Ravelas, chief market strategist at Banco de Oro.

He said a move above the 7,500 level could confirm that last week’s close may indeed already be a near-term bottom.

Lexter Azurin, head of research of Unicapital Securities Inc. said bargain hunting, specifically for stocks that have gone down, prevailed on Friday, thus the market ended on a positive note.

The local stock barometer closed higher by 77.12 points or 1.05 percent to finish at 7,389.30.

However, week-on-week, this saw a decline of 2.49 percent or down by 189 points.

This as the latest US jobs data again resulted in fresh worries over a US Federal Reserve rate hike soon. Worse, some investors worry that the rate hike may happen sooner-than-expected.

There are also concerns on how measures to cap oil production by the Organization of Petroleum Exporting Countries (OPEC) would mean for its members.

For Justino Calaycay of A&A Securities, the prevailing political backdrop, characterized by President Duterte’s tirades against critics of his war on drugs, is not helping.

"The newly-installed government appears to have begun a diplomatic pivot – redefining the nation’s global alliances away from the Americans and the West toward China and Russia," Calaycay said.

It is no surprise that foreign funds continue to flow out, averaging P467 million in each of the last eight days.

But President Duterte's first major state visit to China, with a huge business delegation, may translate to some positive developments for the country including the local stock market.

In all, analysts agreed that the market is still trading in a highly volatile environment.

"Even if the recovery is sustained, the index is still generally trading in a downtrend so expect heavy selling pressure near or at resistance points. Issues that show recovery but trading in a downtrend with technical momentum are those we should be avoiding this week as they gather the most corrective volatility," said Luis Limlingan, managing director at Regina Capital.