For this short trading week, the local stock market is seen to experience thin volumes as investors both here and overseas are still on holiday.

“Soft trading activity is expected for the last trading week of the year, as participants take their time to mull strategies—both in the past and upcoming year,” said 2TradeAsial.com.

The brokerage also noted that liquidity may be affected by another wave of capital raising moves which will open up 2022: two initial public offerings (Figaro Coffee Group and Haus Talk in January) and the planned P40-billion stock rights offering of Union Bank of the Philippines.

“Coupled with a hotly anticipated election season, liquidity may be gyrating at non-normal levels for the first quarter of 2022, further highlighting how lulls in the market—such as that expected (this) week—may be an opportune time to tweak portfolios before the market officially heads off to the races,” 2TradeAsia.com said.

It also warned of remaining concerns regarding the rapidly resurging COVID cases of in much of the developed world which “may be a prognosis of early next year, given how emerging markets seem to track Western economies (with a lag of 3 to 6 weeks).”

“Inflation remains another concern, exacerbated by Typhoon's Odette impact to agriculture and tourism especially in the high growth centers of Visayas and Mindanao,” 2TradeAsia.com said.

It thus advised investors that being sector-selective is still likely to yield better results for 2022, with a clear tilt towards "sunrise sectors” that have better runways for growth despite these caveats.

Following a strategy based on the historical trend of laggards in the current year doing well in the new year, Abacus Securities Corporation is recommending a BUY for LT Group (down 26 percent), Bloomberry Resorts Corporation (down 26 percent), and JG Summit Holdings (down 26.5 percent).

Meanwhile, the brokerage is recommending a BUY for Semirara Mining and Power Corporation due to its high exposure to the electricity spot market at a time when energy supply from Luzon would have to be exported to the Visayas grid in order to make up for the lost supply from the plants damaged by the typhoon.

This should lead to a tightness in supply in the Luzon grid, which should shore up spot market prices.

“SCC should thus benefit due to its exposure to spot while none of its plants were adversely impacted by the typhoon...Investors may thus choose to pick up the stock as we expect SCC to maintain its high dividend yield next year,” Abacus said.

The brokerage is also recommending The Keepers Holdings Inc. because the stock has fallen 30 percent from its postfollow-on offering high of P1.85, and is 13 percent below its offer price of P1.50.

“The fundamentals we talked about during the offer period remain the same. First, Keeper’s imported products are still taking market share from locally produced spirits,” said Abacus.

It added that, “we believe that the company is benefitting from changing consumer behavior. Specifically, that premiumization is driving the sales of its flagship Alfonso brandy.”

“Third, liquor demand will outpace overall consumer spending as the middle class expands,” Abacus said adding that, “we believe Keepers will post 25 percent growth in earnings to P2.0 billion next year. This will be on the back of a recovery in consumer spending and the boost coming from the elections.”

For its part, Regina Capital Development Corporation is favoring Puregold Price Club because its “growth outlooks remains favorable with the economy reopening and upcoming elections season that should sustain their earnings performance. With that, we retain, we retain our BUY recommendation raising our target price to P55.20 apiece.”