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MODEL PORTFOLIO THE GIST
NEWS AND FEATURES
Global Philippines Fine Living
INSIGHTS
INVESTMENT STRATEGY
Economy Stocks Bonds Currencies
THE BASICS
Investment Tips Explainers Retirement
WEBINARS
2024 Mid-Year Economi Briefing, economic growth in the Philippines
2024 Mid-Year Economic Briefing: Navigating the Easing Cycle
June 21, 2024
Investing with Love
Investing with Love: A Mother’s Guide to Putting Money to Work
May 15, 2024
retirement-ss-3
Investor Series: An Introduction to Estate Planning
September 1, 2023
View All Webinars
DOWNLOADS
investment-ss-3
Reports
Policy rate views: Fed expected to do baby steps
September 18, 2025 DOWNLOAD
economy-ss-9
Economic Updates
Inflation Update: Faster but full-year average within target
September 5, 2025 DOWNLOAD
948 x 535 px AdobeStock_433552847
Reports
Monthly Economic Update: Waiting on Jay Powell
September 2, 2025 DOWNLOAD
View all Reports
Equities 3 MIN READ

Stock Market Weekly: Investors keep an eye out for FTSE rebalancing

We are looking at a few catalysts that will influence the movement of the stock market this week: the FTSE rebalancing and the release of the Purchasing Managers’ Indices (PMIs) of the Philippines and the US.

June 27, 2022By First Metro Securities Research
stocks-equities-ss

WHAT HAPPENED LAST WEEK

Last week, the Philippine Stock Exchange index (PSEi) fell by over 100 points to 6,217.56 ( down 1.8%, or by 114 points) following the Bangko Sentral ng Pilipinas’ (BSP) monetary policy rate setting and inflation expectations. The central bank has raised monetary policy rates by 25 basis points (bps) and revised its full-year inflation forecast to 5.0% for 2022 (from 4.6% previously) and 4.2% for 2023 (from 3.9% previously).

Furthermore, the sustained weakening of the peso exacerbated the market’s drop, sending the PSEi near the bear market territory last week. Nonetheless, losses were pared last Friday as the market bounced from oversold levels. The index breadth was negative, with 9 gainers versus 21 losers. The average daily turnover value was PHP 4.4 billion. Foreigners were net sellers by PHP 2.0 billion.

Jollibee (JFC), up 4.2%, was one of the index gainers after management said that it sees growth and expansion continuing this year following a strong start in the first quarter of 2022.

On the other hand, shares of Bank of the Philippine Islands (BPI) declined by 7.2% as the Philippine central bank’s less hawkish stance dragged the financials sector down last week.

WHAT TO EXPECT THIS WEEK

Given that the market remains at oversold levels, we see the market trading higher this week, especially amid possible quarter-end window dressing activities at the latter part of the week. However, the peso’s weakness, rising inflation pressures, and recession worries in the US will continue to influence sentiment and risk appetite. Moreover, investors will be on the lookout for the Financial Times Stock Exchange (FTSE) rebalancing today, June 27, as well as both the Philippine and US manufacturing PMIs (Purchasing Managers’ Indices) to be released on Friday.

STOCK PICKS FOR THE WEEK

Megaworld Corp. (MEG) – BUY

MEG has dropped by as much as 18% month-to-date, tracking the global market rout, amid fears of more aggressive rate hikes. Given the sharp drop, MEG has traded at extreme oversold levels on the daily chart, with its Relative Strength Index (RSI) at 18, the lowest since March 2020. Investors and aggressive bargain hunters can attempt to take advantage of the stock trading at oversold levels to ride the probable bounce. Note that MEG is still on a downtrend, so setting tight stops is recommended. Accumulating MEG at current levels is advisable. Set stop limit orders below PHP 2.10. Take profit at around PHP 2.50/PHP 2.60 .

Raslag Corp. (ASLAG) – BUY

After sliding by as much as 19% from its initial public offering (IPO) price two weeks after the listing date, ASLAG’s share price has rebounded by 26% week-to-date and is now trading above its IPO price of PHP 2.00. It expects revenues to grow significantly after its 18-megawatt peak (MWp) Raslag-3 solar plant begins full commercial operations. ASLAG added that it will start deploying the proceeds from its recent initial public offering to its next two solar power projects, with most of the funding allocated to the planned 35.159 MWp Raslag-4 solar plant in Magalang, Pampanga. Accumulating ASLAG once it breaks above PHP 2.10 is advisable. Set cut loss below PHP 1.98. Take profit at around PHP 2.30/PHP 2.40.

PSEi TECHNICAL ANALYSIS

Resistance: 6,400 / 6,800

Support: 6,180 / 5,700

The PSEi initially broke below the 6,180 support level last week but managed to quickly rebound after trading at oversold levels. PSEi’s RSI last week hit as low as 25, the lowest since January 2021. Nevertheless, the market is not out of the woods unless it breaks above its next resistance levels (6,400/6,800).

TRADING PLAN

Continue setting stop limit orders, especially if the market fails to go back above 6,400 in the coming weeks. The next support levels are at 6,180/5,700.

KEY DATA RELEASES

  1. FTSE rebalancing today, June 27, 2022
  2. Philippine manufacturing PMI for June 2022 on Friday, July 1, 2022 (actual May 2022: 54.1)
  3. US manufacturing PMI for June 22 on Friday, July 1, 2022 (Preliminary: 52.4)

(First Metro Securities Disclaimer: We obtain our information from sources we believe are accurate and reliable, but we cannot guarantee its completeness or accuracy. Our content consists of opinions, not investment recommendations, and you should perform your own research before making any investment decisions. First Metro Securities is not liable for any losses or damages resulting from the use of this information.)

(Metrobank Disclaimer: This is general investment information only and does not constitute an offer or guarantee, with all investment decisions made at your own risk. The bank takes no responsibility for any potential losses.)

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