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Stock investors are seen to remain cautious, despite last week’s strong performance, and will continue to watch for developments related to US trade and tariff negotiations although the start of the first quarter earnings season may inject some life into the local mark”
“The local market rose last week, mainly attributable to its Friday jump. Value turnover is not convincing yet, however, as many are still staying on the sidelines amid lingering uncertainties especially on the global trade front,” said Philstocks Financial Research Manager Japhet Tantiangco.
This week, he said the local market may test its strength while investors are still expected to monitor the developments on the global trade frictions initiated by the US’ tariff policies.
“Positive developments mainly on trade negotiations are expected to boost market sentiment. Lack of such however may cause investors to exit the bourse. The Peso’s strengthening, if it continues next week, is also expected to help the market rise further,” Tantiangco added.
Finally, investors may watch out for the upcoming April S&P Global Manufacturing PMI for clues on the local economy.
For its part, 2TradeAsia.com said “We continue to harp on the relative strength of the Philippine economic model (domestic-driven, services-focused, among others) that is now being highlighted relative to regional peers (IMF slashed PH growth outlook to 5.5 pecent but is still the strongest in the ASEAN).”
It noted that the PSEi continues to trade at a discount from both historical and peer averages while a “benign inflation trajectory, public spending resumption post-elections, private capex continuity, and strong topline growth in the first quarter should all provide tailwinds for the 2025 story of local equities.”
2TradeAsia.com advised investors that, “Selective accumulation in quality names, especially those with visible earnings growth in the medium term, remains appropriate.”
For stock picks, Abacus Securities Corporation has come up with a list of stocks it favors due to their dividend payouts including Semirara, LT Group, DMCI Holdings, Filinvest REIT, PLDT, and RL Commercial REIT.
It noted that, although Semirara, DMCI, and LTG’s dividends have begun to decline, “they are still sizeable enough to outperform most stocks’ dividend yields.”
“FILRT’s payout should see a boost this year from the acquisition of Festival Mall… TEL and RCR are expected to pay out sustainable yields that are above the benchmark 10-year bond yield, and TEL may even see an increase with Maya now in the black.
On average, Abacus said this list should payout nine percent in the next 12 months.
Meanwhile, COL Financial has a BUY rating for SSI Group after upgrading its fair value estimate “in light of our more favorable outlook on earnings recovery this year.”
“We believe SSI's faster-than-expected earnings recovery and outperformance relative to its peers underscores the resilience of its core customer base. The pickup in discretionary spending in the fourth quarter also supports our more constructive view consumer spending this year,” it added.
