Gus Cosio says so

Ideas on the Philippine Stock Market

Are those bulls I’m smelling?

3:00pm     Monday   6 July 2009     PSEi  2449.10 (+0.73%)

The market is up, but it does not feel like it.  I always though that when you see the bull is running, you also see a herd is following.  Why doesn’t it look like that today in spite of a 27 point run up in the PSEi.  Is there something that I am missing out on?  At quick glance, value turnover was Php2.5 billion which  looks decent; but upon looking more closely, I see a huge cross trade of PSE (the stock of the Philippine Stock Exchange) amounting to around Php 900 million leaving normal trades in the region of Php1.6 billion.  That kind of volume does not look like a herd of bulls to me.

However, there are obviously major maneuvering going on among selected issues.  PX for one looks to hold the limelight due to its holdings in a major oil find in Vietnam.  A play in MER is definitely going on because a price of Php 152 is in ear piercing heights.  I would not be in my right mind if I bought it here and now, but for those who have the right reasons, I would not crow if they bought up all the float of this stock.

Headline stocks that I think are fair value at these levels are TEL, AC, GLO, MWC, and MBT.  You may see prices go down a little for these issues but my guess is that they will hold up.  SCC which is my long term play on energy in the Philippines opened at 33 and closed at 34 with fairly good volume.  I still think it is cheap.  There might also be a play going on in BPC.  We’ve been seeing this issue actively bounce up and down over the last 2 weeks.  It only shows that if you kick around on some selected stocks, you can make decent returns trading them.

Anyway, it is the beginning of the week.  There are 4 more days to trade and earn some cash.  Have a good week.

http://www.condron.us

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July 6, 2009 - Posted by | Financial markets in Asia

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