Stock market investors will be eagerly waiting on Monday night or Tuesday morning when the President is expected to announce whether quarantine measures will remain or if there will be some easing even though the number of new COVID-19 cases continues to rise.
“Next week, investors are expected to take cues from the pandemic situation of the country, as well as from the government's decision on our quarantine measures,” said Philstocks Financial Senior Analyst Japhet Tantiangco.
He noted that, “We see a downward bias for the market as local cases continue to rise at an intensified scale. This could change, however, if there would be easing of restrictions coupled with elaborate plans on how to address the virus spread.”
BDO Unibank Chief Market Strategist Jonathan Ravelas said a less stricter lockdown will be seen by investors “as an opportunity to resume the recovery that started in June. This is despite the rising COVID cases in the country.”
He added that, “(last) week's close at 6,076.91 highlights well strong support at the 5,700 levels. Look to see the rally to stay above the 6,000 levels. A sustained rise could see a move towards the 6,300 levels in the near-term.”
Despite a reduction in 2020 and 2021 net income forecast, COL Financial is maintaining its BUY rating on Bloomberry.
“Being the leader in the Philippine gaming space, BLOOM is positioned to capitalize on the recovery in demand once quarantine measures are lifted. We still assume that we would see a gradual recovery starting late this year going into 2021,” the online broker said.
COL is also recommending a BUY for Vista Land & Lifescapes “given that the company has done relatively better amid the ongoing health crisis. The company’s exposure outside Metro Manila has been favorable as other cities and provinces eased quarantine restrictions ahead of Metro Manila, allowing for faster recovery in economic activity.”
It added that, valuation is also attractive and may provide a 40 percent upside from the current market price.
Meanwhile, Abacus Securities Corporation is recommending LT Group after it reported a good profit for the first half of the year.
“While PNB and Asia Brewery dragged earnings, the resilient pictures from PMFTC, Tanduay and Eton should provide cushion for LTG,” said Abacus adding that, “PMFTC, for example, now corners more than four-fifths of LTG’s earnings in the second quarter, a remarkable rebound since its low of 3.3 percent earnings contribution in 2014. This alone makes LTG a pure consumer play.”
As most of LTG’s units are expected to recover in the second half, Abacus said it believes the significance of its consumer business should be highlighted more than the challenges in PNB. It also noted that, LTG is the cheapest conglomerate and it is also trading the lowest it has ever been since listing in 2013.