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Business

Market seen shaky this week

- Zinnia B. Dela Peña -

The local stock market is expected to continue to encounter choppy waters this week as the US economy stays shaky and prices of oil and food continue to rise.

Last week, the main composite index closed 71.49 points or 2.8 percent higher week-on-week at 2,584.21.

“The market is going to be quite shaky this week. We need to move past this roughness to be able to push the market higher and prepare for a major rally, said Juannis Barredo, vice-president of Citiseconline.

Barredo said inflation will be the biggest challenge given its negative impact on consumer spending and corporate margins and heightened interest rate risk. 

Continued strong remittances from overseas Filipino workers will help support consumer spending, partly offsetting the impact of rising inflation.

He said the government’s improving fiscal position puts it in a better position to support economic growth and survive the crisis.

“We think interest will return to the market once there is a clearer picture of when inflation will peak. Possible signs that the inflation crisis is coming to end include a steep correction in oil prices and/or global tightening,” Citiseconline analysts said.

Barredo continues to be optimistic about the prospects of the stock market as he sees the  main composite index ending at 2,600 to  2,800 by the end of the year.

He has advised investors to start buying undervalued stocks in anticipation of a market recovery.

Among Citiseconline’s stock picks include Bank of the Philippine Islands, Jollibee, Ayala Land, SM Prime, Manila Water, Philippine Long Distance Telephone Co., Metrobank, First Holdings, Universal Robina Corp., Robinsons Land, Megaworld, EEI, Meralco, and ABS-CBN Broadcasting Corp.

AMONG CITISECONLINE

AYALA LAND

BANK OF THE PHILIPPINE ISLANDS

BARREDO

BROADCASTING CORP

CITISECONLINE

FIRST HOLDINGS

JUANNIS BARREDO

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