PHILIPPINE SHARES WILL CONTINUE to take direction from developments in global markets as investors remain cautious this week.

The massive selldown last week, which eroded 468 points off the Philippine Stock Exchange index (PSEi), is reason enough to look for ?good values? since a number of stocks have become dirt-cheap, some analysts said.

?I?d say nine out of 10 issues in the stock market are underpriced and almost all of them are blue chips,? said Edgar Bancod, head of research at ATR Kim Eng Securities.

Meantime, AB Capital Securities said in weekly note to clients that what began in the United States as a housing bubble was fast spreading in Europe and Asia as a protracted market slowdown.

?With a market crisis worse than the Great Depression, there is no clear and certain path for the PSEi yet. The index relies heavily on how foreign markets react in the coming days. The US market is still in search of a capitulation point while Europe is just starting with its own bailout packages. Asia, on the other hand, is being dragged by events in these two other regions. Greatly affected by these things, there is yet no assurance of market recovery in the near term for the Philippines,? wrote Maria Narciso, analyst at AB Capital Securities, in a weekly research report.

Campos Lanuza & Co. Inc., on the other hand, said stocks were poised to rebound this week since economic conditions have started improving.

Bancod said a number of shares were reaching levels too good to pass up. Based on its closing prices Thursday, he said Filinvest Land Inc.?s market value was approximately P12.6 billion, at 52 cents apiece. SM Prime Holdings Inc.?s market capital was P2.8 billion, already lower than it?s average capital expenditure of P3.1 billion to put up a mall. Philippine National Bank, on the other hand, is trading at half the book value of its bad assets.