October 25 Philippine Stock Market Daily Review:
Talk about absurdities.
Locals whom have been stampeding out of the market for vacuous reasons once again have plagued the Philippine Market with excuses for a selloff. Oil, inflation, MPC, US markets have prompted locals to take profits after the Phisix’s sensational run up in September. Naturally, the so-called experts are quick to attach bunkums on the after-the-fact events.
As discussed in my newsletter, the ‘October Effect’, which means that the market tends to be soft during this period, has been reinforced by the fact that in the past ten years, October has produced 7 years of losses against only 3 years of gains. This indicates that October presents a statistical probability of 70% that the market will head lower, even as the recent October started at a high of 1,865. This phenomenon could be what is now unfolding right before our very eyes.
Again the local investing mindset manifests its puerile nature in treating equities investment. Had fundamentals such as oil been the factor in today’s market activities apparently we should be seeing rotations to the defensive sector. Oil as of this writing trades above $55 and looks poised for another leg up for another record price high; ironically oil related issues have been even sold down by nincompoops. Gold is likewise $2 dollars away from its decade year high levels (currently at $428 per oz!! bye bye bye US dollar~Bush or Kerry), yet mining issues are sold down, as if the prices of these metals have no relevance to the financial valuations of these exploration and milling companies.
The Phisix closed lower by 26.5 points or 1.5%, the fourth biggest loser in a region haunted by losses for the day. Among the industry indices only the banking and financials index defied the tide up by a scanty .22% largely on Metrobank’s (+1.81%) advance. The Commercial Industrial was the day’s biggest loser down on the country’s duopoly, PLDT (-3.24%) and Globe Telecoms’ (-3.43%), price declines, followed by the OIL index (-1.75%-hahahaha!!!), the mining index (-1.70%-more hahahaha!!!), the foreign supported property index (-.49%) and lastly the ALL index (-.31%). Naturally when locals are bearish the market breadth manifest these; declining issues beat advancing issues 14 to 65. Ugh.
We are seeing continued accumulations by foreign money on the local’s dampened sentiment. Foreign trades accounted for almost 56% of today’s trade while flow of funds to the local equity market registered a positive P 83.150 million worth of inflows. Moreover, overseas investors bought twice more issues than it sold today. Hmmm.
Among the heavyweights only PLDT and San Miguel (-.69%) posted outflows while the most inflows were seen in SM Primeholdings (unchanged), Bank of the Philippine Islands (unchanged) and Ayala Land (unchanged). Other issues as International Container Terminals (-1.96%), DM Consunji (-1.72%), Equitable Bank (unchanged), Filinvest Land (-1.58%) and other second line issues recorded inflows. If these funds from abroad come from institutional investments then what does these entities see in the Philippine market that prompts their accumulations? I thought oil was ah....
Notice too that most of the heavyweights supported by foreign money closed unchanged. The biggest losers among the most active issues are noticeably the ones whom had been the erstwhile market darlings MPC (-5.0%), ELI (-5.88%) and PLTL (-2.54%). Except for MPC the rest looks like a buy buy buy.
Techni-speak, today’s activities brought the Phisix towards key retracement levels. At today’s low, the Phisix corrected by some 43% from its peak while compared to the closing prices at 1,735.69, the Phisix yielded 40% of its current gains.
Talk about absurdities.
Locals whom have been stampeding out of the market for vacuous reasons once again have plagued the Philippine Market with excuses for a selloff. Oil, inflation, MPC, US markets have prompted locals to take profits after the Phisix’s sensational run up in September. Naturally, the so-called experts are quick to attach bunkums on the after-the-fact events.
As discussed in my newsletter, the ‘October Effect’, which means that the market tends to be soft during this period, has been reinforced by the fact that in the past ten years, October has produced 7 years of losses against only 3 years of gains. This indicates that October presents a statistical probability of 70% that the market will head lower, even as the recent October started at a high of 1,865. This phenomenon could be what is now unfolding right before our very eyes.
Again the local investing mindset manifests its puerile nature in treating equities investment. Had fundamentals such as oil been the factor in today’s market activities apparently we should be seeing rotations to the defensive sector. Oil as of this writing trades above $55 and looks poised for another leg up for another record price high; ironically oil related issues have been even sold down by nincompoops. Gold is likewise $2 dollars away from its decade year high levels (currently at $428 per oz!! bye bye bye US dollar~Bush or Kerry), yet mining issues are sold down, as if the prices of these metals have no relevance to the financial valuations of these exploration and milling companies.
The Phisix closed lower by 26.5 points or 1.5%, the fourth biggest loser in a region haunted by losses for the day. Among the industry indices only the banking and financials index defied the tide up by a scanty .22% largely on Metrobank’s (+1.81%) advance. The Commercial Industrial was the day’s biggest loser down on the country’s duopoly, PLDT (-3.24%) and Globe Telecoms’ (-3.43%), price declines, followed by the OIL index (-1.75%-hahahaha!!!), the mining index (-1.70%-more hahahaha!!!), the foreign supported property index (-.49%) and lastly the ALL index (-.31%). Naturally when locals are bearish the market breadth manifest these; declining issues beat advancing issues 14 to 65. Ugh.
We are seeing continued accumulations by foreign money on the local’s dampened sentiment. Foreign trades accounted for almost 56% of today’s trade while flow of funds to the local equity market registered a positive P 83.150 million worth of inflows. Moreover, overseas investors bought twice more issues than it sold today. Hmmm.
Among the heavyweights only PLDT and San Miguel (-.69%) posted outflows while the most inflows were seen in SM Primeholdings (unchanged), Bank of the Philippine Islands (unchanged) and Ayala Land (unchanged). Other issues as International Container Terminals (-1.96%), DM Consunji (-1.72%), Equitable Bank (unchanged), Filinvest Land (-1.58%) and other second line issues recorded inflows. If these funds from abroad come from institutional investments then what does these entities see in the Philippine market that prompts their accumulations? I thought oil was ah....
Notice too that most of the heavyweights supported by foreign money closed unchanged. The biggest losers among the most active issues are noticeably the ones whom had been the erstwhile market darlings MPC (-5.0%), ELI (-5.88%) and PLTL (-2.54%). Except for MPC the rest looks like a buy buy buy.
Techni-speak, today’s activities brought the Phisix towards key retracement levels. At today’s low, the Phisix corrected by some 43% from its peak while compared to the closing prices at 1,735.69, the Phisix yielded 40% of its current gains.
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