By James A. Loyola
Stock analyst are finding it hard to predict how the local market will perform this week given the volatility overseas and the recent weakness of the Philippine Stock Exchange index (PSEi).
“It’s a tough call. Range is between 7,500 to 7,800 now,” said Regina Capital Development Corporation Managing Director Luis Limlingan, adding that “inflation was a positive surprise but may not be sufficient to sustain downward momentum brought about what’s happening outside the country.”
Papa Securities Sales Associate Gabriel Jose Perez also noted that, “movement this week for the PSEi should still be highly likely influenced by US market movement. Support remains at May's low of 7,475.”
For his part, BDO Unibank Chief Market Strategist Jonathan Ravelas said “investors have yet to digest the falling inflation picture along with the lower interest rates and the resumption of government spending should pave the way for a recovery of the growth momentum and improvement in the corporate bottom line.”
“Last week's close at 7,704.60 continues to signal the market to consolidate within the 7,700-8,000 levels in the near-term, provided the 7,500 levels do not give way. Expect a bounce back towards the 7,800 levels in the near term,” Ravelas added.
Amid this uncertainty, Abacus Securities Corporation still sees opportunities in select stocks such as Puregold Price Club as the stock has fallen to its cheapest level since its initial public offering in 2011.
It also noted that Puregold’s growth could pick up as more S&R branches are rolled out over the next few years. Its S&R brand caters to the higher income brackets and enjoys better margins.
Abacus is also maintaining its buy rating for Bloomberry Resorts Corporation despite a recent adverse arbitral decision in Singapore which ordered the firm to pay $100 million in damages.