Stock market investors are seen to remain cautious this week as it does not have any major announcement scheduled that may affect sentiment.
“Next week, the overall sentiment is expected to remain cautious as investors wait for catalysts for the market,” said Philstocks Financial Senior Supervisor for Research Japhet Tantiangco.
He noted that, “Investors are seen to watch out for developments that would help in keeping or boosting the momentum seen in our third quarter gross domestic product and corporate earnings which have been satisfactory.”
Tantiangco said “A sustained downtrend in our COVID-19 cases, continuous progress in our vaccination campaign, and other factors, or cues that could point to further easing of restrictions in the country soon may spur positive sentiment in the market next week.”
He added that that, investors could alsomonitor the new wave of COVID-19 infections in Europe since “If this worsens and spreads outside of Europe, then it may dampen sentiment in the local bourse.”
“(Last) week marks the 10th straight weekly decline in confirmed cases (per World Health Organization's website tracker) at 5,000 new cases this week. Compare this to 30,000 a week in late October and 145,000 a week during the peak in early September, and the markers recent rally towards pre-pandemic levels makes sense,” said 2TradeAsia.com.
It added that, “How sticky this trend will be is another question; however, with factory output at a 7-month high and earnings expectations closed to the upper limit of initial forecasts, a case for an upgrade from our 16 time forward price-to-earnings ratio estimates may be made.”
The brokerage noted that, “Despite a second-straight week of weakness, the main benchmark index's technical upward trend remains intact, albeit with less wiggle room and more bias towards consolidation.”
“Brace for momentum shifts, as funds begin cycling through potential 2022 bets. Trade the range,” 2TradeAsia.com advised.
BDO Chief Market Strategist Jonathan Ravelas said “(Last) week’s close at 7,280.57 highlights the market’s inability to sustain gains above the 7,350 to 7,425 levels.”
“Expect the market to consolidate within the 7,200 to 7,400 levels in the near-term. A break below the 7,200 level will signal a near-term top is in place at 7,475.75 (Nov. 10 high) and may see further losses towards the 7,000 levels,” he added.
COL Financial has a BUY rating on Concepcion Industries because “We continue to like CIC for its positive long-term growth prospects given its market leading position in the underpenetrated air-conditioning and refrigerator markets and increasing share in the fast-growing laundry market.”
The brokerage also has a BUY rating on Cosco Capital because it “remains severely undervalued with the market not valuing its other businesses (apart from PGOLD) like the liquor distribution and real estate business.”
“In fact, if we only value COSCO (adjusting for parent net debt) for its 49 percent stake in PGOLD based on the latter’s market value, this still translates to a target price of P9.70 per share,” COL added.
Meanwhile, Abacus Securities Corporation said GT Capital still currently trading very cheaply, at 8 times forward earnings.
It recommends a but on the stock “With the increase in price and value of its listed units Metrobank and Metro Pacifc in the past few weeks resulting in an increase to their contributions to GTCAP's net asset value, and prospects for continued improved performance for most of its units as the economy reopens.”
COL also has a BUY rating on GTCAP as current discount to NAV also remains near its historical high at 51 percent.
“While the negative sentiment could keep prices depressed in the short term, we believe that these challenges are transitory and that fundamentals remain attractive over the long term,” it said.