{"id":327460,"date":"2024-04-11T00:46:31","date_gmt":"2024-04-10T16:46:31","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=327460"},"modified":"2024-09-01T22:32:34","modified_gmt":"2024-09-01T14:32:34","slug":"consumer-banking-stocks-preferred-as-inflation-rises","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/consumer-banking-stocks-preferred-as-inflation-rises\/","title":{"rendered":"Consumer, banking stocks preferred as inflation rises"},"content":{"rendered":"\n<p>Headline inflation in March 2024 accelerated to 3.7% year-on-year (YoY). This was within the Bangko Sentral ng Pilipinas&#8217; (BSP) forecast range of 3.4-4.2% and slightly behind the consensus forecast of 3.8% based on Bloomberg&#8217;s survey.<\/p>\n\n\n\n<p>Food rose by 5.6% mainly driven by rice (+24.4% YoY) due to tight supply. This was offset by deflation for other food items mainly \u2018vegetables\u2019 and \u2018fish and seafood\u2019. Non-food items were stable as uptick in \u2018transport\u2019 was offset by the deflation in \u2018electricity, gas, and other fuels\u2019.<\/p>\n\n\n\n<p>The BSP kept its policy rates unchanged on 8 April given risks to inflation<br>i.e. El Nino impact on food production, higher electricity rates, and impact of minimum wage hike. We still factor in three rate cuts (75bps total) in the 2nd half (2H) of 2024.<\/p>\n\n\n\n<p><strong>Our View: <\/strong>We think consumer staples will remain defensive until inflation start to ease in 2H 2024. Note also that sector valuations for 2024E\/25E are at 17.9x\/15.6x, which is below the 10 -year average PE of 23.4x current\/20.3x forward with EPS revision at +2.4% YTD. Our top picks here are URC and MONDE. <\/p>\n\n\n\n<p>Meanwhile, banks may continue to outperform the market in the short-term as rate cut expectations are deferred further, which could keep Net Interest Margin (NIM) relatively buoyant specifically for the big 3 banks (i.e. less sensitive to funding cost pressure). Our preferred bank names are MBT and BDO.<\/p>\n\n\n\n<div style=\"height:26px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p style=\"font-size:16px\"><em><em>This report is prepared by PinoyInvestor\u2019s partner broker below. Find out more about <a href=\"https:\/\/www.pinoyinvestor.com\/smartinvestor\/our-partner-brokers\/\">our partner brokers<\/a> and sign up to avail their complete trading brokerage services.<\/em><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Here\u2019s a commentary on an important issue or event affecting the stock market<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1124,11],"tags":[],"class_list":["post-327460","post","type-post","status-publish","format-standard","hentry","category-commentaries-special-reports","category-special-reports","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/327460","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=327460"}],"version-history":[{"count":1,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/327460\/revisions"}],"predecessor-version":[{"id":327462,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/327460\/revisions\/327462"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=327460"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=327460"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=327460"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}