This morning I wrote, “rising stocks have become an entitlement. Combine such overweening outlook with the one way trade sentiment and the lingering trauma (PSTD) from the previous episodes of crashes; the mechanical response has been to savagely bid up the headline index after each account of corrections…Corrections are not allowed even during intraday sessions!
No correction allowed even during the day. Today should be another example.
The PSEi was down from the opening bell until the lunch recess. It dropped by a modest.33% just momentarily after the break. Only 3 of the top 11 issues were up.
But operation ‘afternoon delight’ immediately went into action. Sustained heavy pumping on SMPH, SM and MBT tried to offset losses led by AC and ALI. AC was even down by as much as 1% at its lowest during the day.
Yet the pump succeeded in the conversion of the dominant sellers into buyers!
By 3pm, the PSEi was neutral! Losses by most of the top 11 PSEi issues were either mitigated or reversed!
Past 3 pm, AC turned positive. And so did the index.
Then panic buying went into a hyper mode.
And as routine, the PSEi's afternoon delight pump climaxed with a price fixing push which contributed to about 30% of the day’s close.
The PSEi has breached 8,100!
I have also said early this morning that “history has been unfolding right here, right now.”
For the bulls history would mean the old record high of 8,100.
For the third time this year, officials of the PSEi today celebrated on a yet to break April 10 2015 record high: "We see local and foreign investor confidence getting a boost from expectations that the Philippine economy will continue to outperform its peers. This should hopefully reflect in corporate performance," said PSE President and CEO Hans B. Sicat.
Even after adjusting for 2015 earnings two weeks back, unfortunately, PSE officials have seemingly been remiss (or oblivious) of their duties to public to publish even a summary, via their press room, of the earnings performance for the year 2015. They forgot to report on 2Q and 3Q 2015 performance too.
Why the silence? And how ironic for them to talk about corporate performance when the PSEi hits their price targets!
Yet the PSE gives a clue on their reticence: PSEi prices “Hopefully reflect in corporate performance”. So high prices equals G-R-O-W-T-H! Yet the lack of improvement in the past means silence!
Nevertheless hope is different from fact or reality. This also means that for the PSE, hope has been the guiding principle of the present run!
But the alternative view is that unfolding history represents climatic mania in process.
As of today’s close, the average PER was at a shocking 27.142! The market cap weighted PER was at an even more nosebleed 27.9. Such level has almost reached the peak PER of 1997 at 28.21!
Yet why has the PSE not reported on this too? Ah yes of course, PERs are essentially earnings.
More importantly, high PERs signify a product of collective BW-SSO blow off patterns!
Today’s index drivers virtually on a BW-SSO mode!
SMPH up by a stunning 3.51% ramp today! MPI had a huge 3.73% run! Panic buying at the top! Why?
For today, price gains of AC +.56%, MBT +2.65%, SM +.79% and RLC +.15% only exacerbated on the violent upside price trends!
Yesterday I wrote, “If momentum picks up, in the same way as BW and SSO, then there should be a TERMINAL blowoff phase. Stock prices (by many firms) will contemporaneously spike by even a larger proportion than today, over the next two-three weeks. And this means 8,127.48 will be taken down. The PSE will have a shindig. But as BW and SSO patterns reveal, the sharp upside movements of the FINAL vertical stage would redound to or will be followed by an equally sharp downside. The vertical ramp will be erased. Greed will morph into Fear. And fear will strike into very hearts of the market participants”
Today’s actions have reinforced manifestations of the transition towards the final blow off phase.
Finally, explosive moves, if history should rhyme, will end with a grand implosion.
Bonus chart: MWIDE shows of an fantastic 50% surge via the Viagra effect in just 17 days! That’s about 2.94% returns a day! Explosive moves everywhere.
Why work or invest when free lunches exist!
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