STOCK-MARKET OUTLOOK

Last week

Share prices gained last week after investors, who shrugged off the extension of the strictest quarantine measures for one more week, snapped up cheap stocks.

The benchmark Philippine Stock exchange index (Psei) rose 102.08 points to close at 6,545.17 during the four-day trading week.

The main index was up for 3 straight days, but gave up points on Thursday after many investors decided to pocket the gains they made during the previous sessions.

average daily trading value for the week was low at P5.18 billion, as foreign investors, which made up just more than a third of the total trades, were net sellers at P2.29 billion.

all other subindices ended in the green led by the broader all Shares index that gained 74.35 points to close at 3,998.64 points, the Financials index rose 13.64 to 1,387.47, the Industrial index soared 281.20 to 8,890.89, the holding Firms index increased 107.55 to 6,632.36, the Property index added 41.75 to 3,253.67, the Services index was up 14.75 to 1,429.34 and the Mining and Oil index climbed 21.38 to 8,498.31.

For the week, gainers led losers 178 to 53 and 20 shares were unchanged.

Top gainers were ever-gotesco resources and holdings Inc., Primex Corp., Grand Plaza hotel Corp., Cityland Development Corp., United Paragon Mining Corp. and Chemical Industries of the Philippines Inc.

Top losers were Semirara Mining and Power Corp., Nihao Mineral resources International Inc., Keppel Philippines Properties Inc., Paxys Inc., anchor Land holdings Inc. and atlas Consolidated Mining and Development Corp.

this week

Share prices may continue to rise this week as the government announced a more lenient modified enhanced community quarantine (MECQ) in Metro Manila and nearby provinces of Bulacan, Cavite Laguna and rizal for the rest of april starting Monday.

Trading, however, may still be volatile as Covid-19 cases continue to go up. Japhet Louis O. Tantiangco, senior research analyst at Philstocks Financials Inc., said investors are expected to take cues from the country’s Covid-19 situation as well as the declaration of MECQ in the National Capital region (NCR) Plus area, as these are currently seen to be the key factors weighing on market sentiment.

“If the elevated numbers [of infections] are sustained, then it is seen to tilt the market’s bias to the downside. If we see a significant drop in the figures however, then we may see a positive reaction from the local bourse,” Tantiangco said.

he said the Psei’s 50-day exponential moving average is about to cross below its 200-day counterpart. “If this continues, it will form a Death Cross which is a bearish signal, indicating a possible downtrend moving forward. The local market’s initial support is seen at 6,100; initial resistance is seen at 6,600.”

Meanwhile, broker 2Tradeasia said it recalibrated its targets for this year with the declaration of enhanced community quarantine in NCR Plus and MECQ for the rest of april. It expects GDP to grow by 5.1 percent, lower than its previous estimate of 7 percent for the year.

“The added economic strain of 2021 restrictions have also impacted 2022 numbers, with expectations [of GDP growth] sitting at 7.2 percent from 8.9 percent. as the pandemic remains a developing story, vaccination progress and fiscal stimulus are also likely to influence projections down the line,” it said.

stock picks

Broker regina Capital Development Corp. gave a buy recommendation on the stock of RFM Corp. on the resiliency of its consumer business and recovering institutional business during the second half of last year.

“During the first half of 2020, its institutional business was slowed during the implementation of strict quarantine measure to contain the virus spread nationwide. Thankfully, said restriction was eased towards the close of the year. however, for this year, this segment’s recovery would likely be trampled to some extent due to the reimposition of a week-long ECQ within the Metro, aside from the week-long NCR [Plus] bubble,” it said.

It said the growth propeller for this year would still be its consumer business as it is well positioned in the shift in consumer behavior amid the pandemic. as the public continues to look for value for money products, rfm’s bundled products will be placed under the limelight, it said.

It gave a target price on the stock at P5.50.

RFM share price ended Thursday at P4.75 apiece.

Meanwhile, it advised to sell on rallies on the stock of DITO CME holdings Corp. after it broke out past a week-long resistance following three days of trading on a significantly thin range.

“Indicators have just picked up on buy signs with increasing histograms and pressure. There is a pretty strong resistance at P11.60, but should DITO break this level, it could fill the gap to P12 quickly. Volatility is quite low still, though, so the rally may be short-lived,” it said.

DITO’S shares closed last week at P10.98 apiece. VG Cabuag