The local stock barometer fell sharply on Tuesday, tracking a global selloff ahead of a prospective interest rate hike by the US Federal Reserve.
The main-share Philippine Stock Exchange index (PSEi) tumbled by 100 points or 1.33 percent to close at 7,420.40 as foreign investors dumped local equities.
Local stock brokerage Papa Securities said the local market was weighed down by bleak sentiment in overseas markets.
The brokerage said it was “expecting the Wall Street VIX (volatility index) to trek toward the 28 mark within the week amid Federal Reserve plan to raise interest rates that may be too much for the US economy to handle.”
But the pullback of the PSEi should be taken as an opportunity to position on select counters, bearing in mind strong support around the 7,350 mark, it said.
“[It’s] high time to accumulate on consumer stocks that are expected to ramp up on 2019 election spending. The lower inflation next year heightened by lower crude oil and stable commodity prices will likely support the sector. Furthermore, strong remittances for the [fourth quarter of 2018] are also a boost to the consumer issues,” Papa Securities said.
Its top picks on the consumer play are Jollibee, Puregold, RRHI and D&L Industries.