The local stock market is seen to have muted trading this week as most investors, both domestic and foreign, are already on holiday break.

“The last two trading clays of the week, owing to funds having gone off to take the long holiday break, are expected to be quiet,” said online brokerage firm 2TradeAsia.com.

It added that, “Seasoned investors will take the period to reflect on portfolio strategies planned for the next year: the events that shaped 2020 are, after all, anything but auspicious.”

“How COVID-19 has changed our ways of living will certainly continue to bleed through the financial markets for 2021,” 2TradeAsia.com noted.

The brokerage said “The pandemic remains to be the single-biggest threat to risk-asset investing currently, as a new strain of coronavirus in parts of Europe offset the record-speed at which vaccines are being deployed globally.”

Thus, it said “This supports not only a guarded outlook for full economic reopening plays (such as aviation, tourism, and leisure) but also that COVID-19 at the end of the day, remains to be a developing case; in this regard, market participants may have to brace for extra volatility in the corning weeks.”

“Approach next positions with both a hopeful heart and a cautious hand,” said 2TradeAsia.com adding that, “Immediate support is 7,070, secondary at 7,000, while resistance is at 7,300.”

For its stock picks, Abacus Securities Corporation is recommending COSCO Capital and its subsidiary Puregold Price Club.

It noted that COSCO’s cash dividend this year is 33 percent higher than in 2019 and “we do think this higher dividend payout can be sustained in the next few years as the cash (for new projects or capital expenditures) remains undeployed.”

Abacus also cited that the firm’s market capitalization is only at P41 billion even as its stake in Puregold is already worth P57.2 billion, thus investors will get its real estate, liquor distribution and specialty retail businesses for free.

In the case of Puregold, Abacus said “We believe value investors may find a bargain in the stock as Puregold trades 1.5 times standard deviations below its historical average PE (price to earnings ratio). Patient investors may wish to begin accumulating the stock.

Meanwhile, Abacus has listed this year’s worse performing index stocks for investors who wish to follow its strategy of investing in bottom dwellers which tend to catch up and outperform in the following year.

The bottom six, so far, are Robinsons Land Corporation, Bloomberry Resorts Corporation, GT Capital Holdings, Metropolitan Bank & Trust, Security Bank Corporation, and BDO Unibank.