The local stock market is seen to continue being pulled back and forth by earnings reports and positive factors such as the improving Covid-19 situation and negative risks such as Russia’s invasion of Ukraine and inflation fears.

“Next week, the local market may continue to trade sideways within its 7,300 support and 7,500 resistance,” said Philstocks Financial Senior Supervisor for Research Japhet Tantiangco.

He noted that, “The sustained improvements over our Covid-19 situation is seen to fuel positive sentiment which can provide the market support.

The signing of Republic Act 11647 which eases foreign investment restrictions may also give positive sentiment a boost.

However, Tantiangco said “Significant rallies are not expected yet as the Russia - Ukraine conflict is seen to weigh on the market. The local bourse could remain clouded by inflation worries amid the elevated oil prices caused by the said conflict.”

“A further escalation of the war between the two, and a further rally of oil prices may put the 7,300 support at risk,” he added.

Next week, investors may also take cues from the upcoming foreign trade and investment data, as well as from corporate earnings reports.

“Fiscal year 2021 earnings are coming in as expected, with 56 percent of the PSEi basket already reporting result,” said 2TradeAsia.com adding that, 21 percent of the PSEi basket will release results this week.

It warned that, “We have yet to account for the margin impact of higher oil prices, nor the trickier dollar and interest rate effect to balance sheets.”

However, 2TradeAsia.com said that, “while there is impetus to go light on sectors with immediate topline impact ( such as downstream oil, airlines with European traffic exposure) there may be windows of opportunity in upstream oil, renewable energy, and some consumer staples, that can take advantage of the higher output price and ultimately still pass on costs.”

“Brace for further broad-based volatility., but particularly to the ‘sensitives’ which include shares with high import exposure, dollar-denominated debt, fuel costs, among others,” it said.

BDO Chief Market Strategist Jonathan Ravelas said last week’s close at 7,342.01 highlights the market’s risk-on, risk-off mood amid the Russia-Ukraine conflict.

“Should bargain hunting continue, it may retry the 7,400 to 7,500 levels anew. However, failure of the market to sustain the gains, it could bring us back towards the 7,000-7,350 consolidation range,” he added.

From last week’s corporate results, both COL Financial and Abacus Securities Corporation picked Robinsons Retail as Buy for exceeding expectations.

“Results outperformed both COL and consensus estimates, accounting for 121.4 percent and 121.6 percent of full-year forecasts, respectively,” said COL.

It added that, “We continue to like RRHI given its well-diversified portfolio of retail formats and positive long-term growth prospects. We think its recovery initiatives, especially the strengthening of its e-commerce platform, makes RRHI well-positioned to capitalize on future growth opportunities amid increasing digital trends.”

For its part Abacus said “We maintain our Buy rating on RRHI as earnings were well ahead of consensus on the back of higher margins. We will review our assumptions to see if there is scope to boost our target price for the stock.”

COL also has a Buy rating for PLDT as the firm’s home broadband segment is expected to maintain its resilient growth as it continues to tap underserved areas, ramp up installations, and improve customer experience.

It also noted that, PLDT’sstock is trading at 5.6 times its estimated earnings for 2022, “much lower than Globe’s multiple of 7.1 times and Converge’s multiple of 11.7 times.

Abacus also has a Buy rating for Petron, “as elevated refining margins and the steady recovery in sales volumes should boost earnings for this year.”

It noted that the combination of recovering demand and limited supply due to lower exports by China fuelled the surge in margins, thereby benefitting all refiners, including Petron.

“Besides the windfall from higher refining margins, the blistering run of crude oil prices should also translate to hefty inventory gains, positively impacting Petron’s earnings,” added Abacus.