On Tuesday, Japan's Abenomics gets another pulse check, as household spending, employment and retail sales data are released, industrial production numbers are out on Wednesday. Friday will be a big day --- the Bank of Japan releases its business sentiment survey -- the Tankan Survey, China manufacturing and services index are also out, while the US releases non-farm payrolls for March. A Reuters poll shows payrolls are expected to have increased by 200,000 jobs in March, below February's 242,000 gain.
Angel Pacis, First Vice President & Trust Officer at East West Bank says the 'markets are living on day-to-day data' when it comes to the actual policy the Fed will be taking going forward.
"They call it the 'sweet spot' in terms of data, good enough to signal the US economy is continuing its current track, but not strong enough to encourage more aggressive rate hike stance from the Fed. That's what the market is looking for to continue its upward trajectory."
CONGLOMERATE PLAY : ALPHA PLAY
In the meantime, Pacis is placing her bets on conglomerates this year, which she says will continue to benefit from strong economic growth and domestic dependence, as well as incentives for infrastructure play.
"Ayala Corp is into infrastructure, it's a good proxy for the Philippine economy, plus it's also in sectors that are expected to grow faster like education and power. While we like Metro Pacific because of valuations."
SM investments is also a stock pick.
These companies are expected to outpace expected average growth of 10% this year.
East West bank's year-end forecast is at 7400.
RCBC BACK IN SPOTLIGHT
Pacis believes while sentiment on RCBC will continue to take a hit, triggering retail selling, she says overall -- the bank won't see any big negative impact on bottomline. She adds, banks in general are in a stable position.
"This is what I call noise. The Philippine Banking Sector is in a very stable position and any selldown which brings it to fair value should be an opportunity to pick up stocks."
The Senate resumes its third hearing on the alleged $81-M Money Laundering case, on Tuesday, March 29.
source: www.abs-cbnnews.com
