The stock market is expected to move sideways this week, with investors monitoring developments overseas.

AB Capital Securities said the local market decoupled slightly from the Dow Jones but eventually succumbed to worries of a prolonged global financial crisis.

?It became apparent that the modest gains achieved by the PSEi were due to some optimism in selected companies. In the end, worries of a deepening and prolonged global recession weighed down the index,? AB Capital Securities said.

First Metro Investments Corp., the investment banking unit of Metropolitan Bank and Trust Co., saw the stock market bottoming out this year. It said the market was still in the process of finding the bottom although share prices had dropped to attractive levels.

The investment house said it anticipated the much-awaited recovery in the stock market next year yet.

First Metro expects companies to reduce their capital expenditure this year because of the current economic situation. The balance sheet of some companies may strengthen when they opt pre-pay loans amid declining interest rates,

First Metro, meanwhile, identified growth opportunities this year, especially in the areas of infrastructure, utilities, food and housing.

The market last week attempted to breach the 2,000-point psychological resistance but failed to push past the barrier due to lack of positive news.

The index lose 1.75 percent last week to close at 1,950.13 as the market weighed in several negative reports, including disappointing profits and losses registered by some big listed American companies.

Average daily turnover last week rose to 1.37 billion shares but the average value fell to P1.242 billion from 1.042 billion shares and P1.571 billion week-on-week, respectively.

Economic Planning Secretary Ralph Recto said he expected the economy to grow by as much as 4.7 percent this year, boosted by government?s pump-priming activities.

President Gloria Macapagal Arroyo earlier asked Congress to approve a P300-billion stimulus package to help the Philippines spend its way out of the global recession.

The government plans to spend heavily on infrastructure projects and social services to immediately create an impact on the public.

The government also vowed to step up revenue collection efforts by going after tax evaders and smugglers and improve the efficiency of the internal revenue and the Finance Department urged lawmakers to pass a bill raising the excise taxes on tobacco and liquor products to finance government spending. Jenniffer B. Austria