MANILA, Philippines—Bargain hunting may lift local stocks in the days ahead after local share prices fell in four out of five days last week, leaving many index issues undervalued.
The Philippine Stock Exchange Index (PSEi) ended last week at 4153.11, down 1.57 percent from 4219.58 the week before.
The main index was up for most of Friday’s trading session before falling in the closing minutes as investors booked profits ahead of the three-day weekend.
Jun Calaycay of Accord Capital said Friday’s mid-day rally might have been caused by the central bank’s decision to keep policy rates at near-record lows the day before.
Despite a hike in bank reserve requirements, “this corner believes that the central bank decided in favor of economic growth, which in the first quarter significantly slowed to 4.9 percent,” Calaycay said.
“On hindsight, this is what may have driven a mid-session rebound in equities [last Friday]. Nevertheless, the rally opened up opportunities for investors to book profits ahead of an extended weekend. This sent the measure lower,” he explained.
Calaycay said several stocks have become potential bargains as a result of last week’s losses. One such issue was that of Megaworld Corp., which on Friday closed 0.52 percent lower. This came despite an announcement by its management that the real-estate developer would post an 18-percent hike in profit for the year.
Other potential candidates for short- to medium-term rallies are Security Bank, Robinsons Land, Universal Robina Corp. and Philippine Long Distance Telephone Co.—Paolo G. Montecillo