Will the U.S. economy's recovery be good for the Philippines?
The Philippine economy performed well during the crisis, will it do even better during the recovery? I would hazard a resounding yes. Here's why.
1. We'll see an increase in demand for minerals
2. Our Business Process Outsourcing Industry will remain strong
3. OFW remittances will keep on growing
Number two and three, BPO and remitances, are the reasons why we are doing relatively well during this global financial/economic crisis. Those are no-brainers and have probably already been priced into the market.
Number one is what will shake things up. When demand for minerals increase, mineral rich countries like the Philippines have a great opportunity to make good money.
What does all this mean for common sense traders?
The languishing mining stocks will return to the new horizon. Before this global crisis, mining was under a spotlight. When the world pulls out of the recession and begins its recovery, I forsee a strong and steady increase in the value of local mining shares.
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Note though that PX is is oversold at its present nine-ish price. This is probably due to speculation over news of a new investor coming in.
Tuesday, August 11, 2009
Friday, July 3, 2009
a beautiful picture in hindsight
The past few months have been great for the PSEi. From 1745, the index climbed all the way to 2626 in the last three months.
That can make a lot of people excited. Not me though.
The obvious conclusion is that gains like that are NOT sustainable. I don't have to whip out my calculator and formula book to figure that out. This index cannot keep this pace up. As we haven't seen much of a correction yet, I think its coming. Soon.
Time to sell. Time to hold. Not a time to buy.
That can make a lot of people excited. Not me though.
The obvious conclusion is that gains like that are NOT sustainable. I don't have to whip out my calculator and formula book to figure that out. This index cannot keep this pace up. As we haven't seen much of a correction yet, I think its coming. Soon.
Time to sell. Time to hold. Not a time to buy.
Monday, April 13, 2009
gmanews: RP bourse outperforms ASEAN stock markets
This is interesting. According to GMAnews.tv, the PSEi has done better than its neighbors. This really speaks well of our fundamentals.
Click here for the full article.
Click here for the full article.
is it time to buy?
Markets around the world have seen good gains over the past weeks specially in Asia. When the numbers are in the green, there is always a lot of excitement generated. So with everyone wondering if its time to buy, i can't help but wonder the same thing myself.
I don't think its really the time to be buying quite yet. I would recommend that we still be cautious. I'll maintain my current strategy of small buys stretched over a long period.
Too much excitement
It's been a while since we've seen good numbers and I think this might cause the markets to get ahead of themselves. So far, the PSEi remains very responsive to the U.S. indeces so I remain attentive to what's happening over there. While the so called "green shoots" are emerging from the devastated American Economy, I don't think all the bumps are already behind.
Credit Card fallout
One thing I'm very concerned with is the Credit Card fallout that is hanging over the American Economy like the sword of Damocles. Even without very detailed specifics, we know that the American consumer uses credit cards for a very large part of their purchases. When a job is cut, credit isn't. So what happens when the droves of jobless start defaulting. We'll again see some ugly figures and have to digest them. It may not be such a big deal from a macro economic point of view, but something like that can really rattle the markets. It's coming and I would like to wait for that to pass before I make some big buys.
Waiting game is coming to an end
Over the past months, I've read and read and read about whether its a good time to buy. Most articles say the same thing. There is tremendous opportunity now. Timing and selection is the key. That kind of vague advice isn't really very helpful when it comes right down to making specific purchases but considering that around November 2007, the chorus of the blogosphere was sell, sell, sell and that the experts were saying similar things makes me feel good even about such vague advice. I sense that the time for waiting is coming to an end. The window of this "tremendous opportunity" will soon close.
I don't think its really the time to be buying quite yet. I would recommend that we still be cautious. I'll maintain my current strategy of small buys stretched over a long period.
Too much excitement
It's been a while since we've seen good numbers and I think this might cause the markets to get ahead of themselves. So far, the PSEi remains very responsive to the U.S. indeces so I remain attentive to what's happening over there. While the so called "green shoots" are emerging from the devastated American Economy, I don't think all the bumps are already behind.
Credit Card fallout
One thing I'm very concerned with is the Credit Card fallout that is hanging over the American Economy like the sword of Damocles. Even without very detailed specifics, we know that the American consumer uses credit cards for a very large part of their purchases. When a job is cut, credit isn't. So what happens when the droves of jobless start defaulting. We'll again see some ugly figures and have to digest them. It may not be such a big deal from a macro economic point of view, but something like that can really rattle the markets. It's coming and I would like to wait for that to pass before I make some big buys.
Waiting game is coming to an end
Over the past months, I've read and read and read about whether its a good time to buy. Most articles say the same thing. There is tremendous opportunity now. Timing and selection is the key. That kind of vague advice isn't really very helpful when it comes right down to making specific purchases but considering that around November 2007, the chorus of the blogosphere was sell, sell, sell and that the experts were saying similar things makes me feel good even about such vague advice. I sense that the time for waiting is coming to an end. The window of this "tremendous opportunity" will soon close.
Thursday, April 2, 2009
is it a breakout?
When the index finally woke up from its sideward slumber, did it indicate that it was ready to trend upwards?
I'll leave that answer to the technical experts. See tsupitero.com.
What tickles me now is that the good numbers of our index are inebriating the investing community. Will it trend up? I don't know, but they're saying there's good chance.
I'll leave that answer to the technical experts. See tsupitero.com.
What tickles me now is that the good numbers of our index are inebriating the investing community. Will it trend up? I don't know, but they're saying there's good chance.
Wednesday, March 18, 2009
when will it end?
The index may as well be a straight line. The trend has been sideways for so long, it's getting boring.
I guess we can just be glad we're not seeing the market values plunge like it is for most of the developed world.
I guess we can just be glad we're not seeing the market values plunge like it is for most of the developed world.
Tuesday, January 13, 2009
U.S. indeces take a tiny drop while Japan takes a beating
While U.S. market indeces took a few steps down, Japan's market dropped a whopping 4.8%.
The PSEi inched down and settled a mere 1.79 points from yesterday's close after ever so briefly punching past the psychological 2000 level at around eleven this morning.
The dow was down 1.46%, the nasdaq by 2.09%, the s&p by 2.26%.
Friday, January 9, 2009
fuel for thought
A blogger named Steve Austin (of oilprice.net) wrote:
"It took only 5 months for the price of oil to plummet from $150 to under $40 in the second part of the year. Meanwhile oil consumption did not even decrease 10%."
If he has his facts straight, then the oil price will be back with a mighty vengeance. The low price is necessarily negatively affecting production capacity. Supply will keep going down at these low price levels.
He also said that oil is now being sold below the cost of production. That adds another dimension to the bad news for oil consumers. This means that many of the relatively small players will close down and the ones that survive will have less competition. Less competition puts less downward pressure on the price.
Let's enjoy this happy breather while we can. :) Hopefully by the time oil starts to surge we'll have more energy options at our disposal.
PSEi
As energy prices affect the outlook for stock prices, we should be mindful that the current strength seen in the PSEi is still very vulnerable. The low oil price is one of the factors that has allowed the market to climb back ever so close to the 2000 level. Let's not forget how devastating the oil price can be.
Oil was traded recently at $42.30 (January, Friday 9 2009 - 03:20:17).
"It took only 5 months for the price of oil to plummet from $150 to under $40 in the second part of the year. Meanwhile oil consumption did not even decrease 10%."
If he has his facts straight, then the oil price will be back with a mighty vengeance. The low price is necessarily negatively affecting production capacity. Supply will keep going down at these low price levels.
He also said that oil is now being sold below the cost of production. That adds another dimension to the bad news for oil consumers. This means that many of the relatively small players will close down and the ones that survive will have less competition. Less competition puts less downward pressure on the price.
Let's enjoy this happy breather while we can. :) Hopefully by the time oil starts to surge we'll have more energy options at our disposal.
PSEi
As energy prices affect the outlook for stock prices, we should be mindful that the current strength seen in the PSEi is still very vulnerable. The low oil price is one of the factors that has allowed the market to climb back ever so close to the 2000 level. Let's not forget how devastating the oil price can be.
Oil was traded recently at $42.30 (January, Friday 9 2009 - 03:20:17).
Fitch keeps RP's outlook at 'stable'
Another reason to bet on the Philippine Economy
The Philippines along with China and Indonesia were singled out by Fitch managing director James McCormak as the only countries that were not on Fitch Ratings' negative watch.
watch of for these long weekends in 2009
The stock market loves its long weekends. Here are some to watch of for in 2009.
Araw ng Kagitingan April 4-6 3 days
Holy Week April 9-12 4 days
Labor Day May 1-3 3 days
Independence Day June 12-14 3 days
National Heroes August 21-24 4 days
All Saints/Souls October 31-Nov 2 3 days
Bonifacio Day November 28-30 3 days
Araw ng Kagitingan April 4-6 3 days
Holy Week April 9-12 4 days
Labor Day May 1-3 3 days
Independence Day June 12-14 3 days
National Heroes August 21-24 4 days
All Saints/Souls October 31-Nov 2 3 days
Bonifacio Day November 28-30 3 days
Saturday, January 3, 2009
is megaworld at a bargain?
As one of the shinning stars of 2007, Meg was pushing past Php4 per share. It was last traded before Christmas at Php0.66.
It came quite a long way down. Is it at a bargain? Megaworld seems to think so. In a press release last year, they said that they expect P1.4 billion in sales revenues from its fifth Greenbelt-area project. It is dubbed the Greenbelt Madison. The 31-story building will rise along Salcedo St. in Legaspi Village, Makati City.
A couple of weeks prior to the press release on November 25. They bought back some 2,100,000 shares at 0.5028. After the transaction, 20,510,226,901 shares remain outstanding and 131,420,000 are in the treasury.
Does that mean that they put their money where there mouth is? I don't really think so. 2.1M shares is barely a drop of dew on a rainy morning and thus is not conclusive of their position.
Nonetheless, I personally like this stock. It's a company that appears to have had rode the wave of the sunrise BPO industry rather well. Do I think its at a bargain? Yes. I do.
It came quite a long way down. Is it at a bargain? Megaworld seems to think so. In a press release last year, they said that they expect P1.4 billion in sales revenues from its fifth Greenbelt-area project. It is dubbed the Greenbelt Madison. The 31-story building will rise along Salcedo St. in Legaspi Village, Makati City.
A couple of weeks prior to the press release on November 25. They bought back some 2,100,000 shares at 0.5028. After the transaction, 20,510,226,901 shares remain outstanding and 131,420,000 are in the treasury.
Does that mean that they put their money where there mouth is? I don't really think so. 2.1M shares is barely a drop of dew on a rainy morning and thus is not conclusive of their position.
Nonetheless, I personally like this stock. It's a company that appears to have had rode the wave of the sunrise BPO industry rather well. Do I think its at a bargain? Yes. I do.
what will happen to stocks for 2009
I do not see a coherent consensus of what will happen to the stock market in 2009.
What I have noticed are the following:
1. The world is watching the U.S. and China very closely.
2. The consensus is that there is no consensus
U.S. and China
The U.S. is where this all began. World markets have spent 2008 following the lead of American markets. My own opinion is that the some of the usual suspects will break away. As businesses begin to feel the real effects of the changes in the economic environment of the world and see clearly what it does to their balance sheets and income statements, confidence will be restored to where it should be. The fact is, America isn't the world and if America continues to suffer economically in 2009 not everyone will.
No consensus
There's talk of a rebound in the third quarter while there's also talk of the S&P 500 falling to 500 and staying there at years end.
How will the PSEi look by the end of 2009? I wish I could tell, but what I do know is that the Philippine economy is set to weather the storm in a manner far superior to the developed world. The long and the short is that the outlook for BPO is still strong, remittances are still poised to grow, albeit slower, the Banking Sector is guarded by regulations from the lessons of 1997 and the list does go on.
Thus, even if we can't see where the PSEi will be twelve months from now, we know that the Philippine economy is a logical bet in the long run. Stock prices are low so all we need now is some good intel on which ones are at a bargain and which ones are are cheap in reflection of their true value or lack of it.
What I have noticed are the following:
1. The world is watching the U.S. and China very closely.
2. The consensus is that there is no consensus
U.S. and China
The U.S. is where this all began. World markets have spent 2008 following the lead of American markets. My own opinion is that the some of the usual suspects will break away. As businesses begin to feel the real effects of the changes in the economic environment of the world and see clearly what it does to their balance sheets and income statements, confidence will be restored to where it should be. The fact is, America isn't the world and if America continues to suffer economically in 2009 not everyone will.
No consensus
There's talk of a rebound in the third quarter while there's also talk of the S&P 500 falling to 500 and staying there at years end.
How will the PSEi look by the end of 2009? I wish I could tell, but what I do know is that the Philippine economy is set to weather the storm in a manner far superior to the developed world. The long and the short is that the outlook for BPO is still strong, remittances are still poised to grow, albeit slower, the Banking Sector is guarded by regulations from the lessons of 1997 and the list does go on.
Thus, even if we can't see where the PSEi will be twelve months from now, we know that the Philippine economy is a logical bet in the long run. Stock prices are low so all we need now is some good intel on which ones are at a bargain and which ones are are cheap in reflection of their true value or lack of it.
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