Wednesday, September 19, 2018

PHP Exchange Rate & PH Stock Market Outlook 2

In response to requests
As of Sept 19-20, 2018
PHP Exchange Rate & PH Stock Market Case Scenario based on Facts & Data
A Decision where Investors should make a stand! 

The PSEI previous market recovery can now be called a 'dead cat bounce' as we have made mention that diagonal uphill climb towards the 7880/81 levels twice would not be a full recovery. The re-emerging US - China trade war spat, foreign investment outflows other than inflation pressures have come at terms with regional peers to do the same market reaction.
 
The PHP exchange rate is relatively down against the USD as much as -13.63% for the past 3 years. But nearly two years in the making to reach this record levels as described in our trade plan. While on a YOY basis it is -5.46% compared to a YTD at -7.23%. Now with inflation at 6.4% from the recently released data and the PH Stock market index at 7221.23 equivalent to a -15.62% YTD level decline, nearing the -18.12% loss when the PSEI was down to 6929/86 last June 25, 2018. 


But with the current day's low at 7189 as of 9.20.18 Asia session, the question is how much further does the index have to go where the equivalent component's mix prices have gone lower from their previous registered low? 

With that said, how much do you think should the market recover to for retail investors to make a decent return on their equity investments? Meanwhile investors / traders still have to pay an adjusted tax increase for every trade done

Discussing these facts is already a given. What needs to be done is to have the right trading solutions and be prepared for the next turn around. 

Although, these figures may be pessimistic; being optimistic there is still a probability of a turn around once the numbers that we are expecting the market to mark by the 4th quarter entry be reflected. But until such data and figures shows we would not want to speculate on a full turn around unless certain narratives changes that would provide the major catalyst to turn the PH market higher without resorting to window dressing for clients benefit.

Special Analysis Report & Market Outlook for Premium TSOT members
PSEI September 21 Surge to 7383 Post Market Selloff

To find out where and how should PH - Asian Self-directed Investors / traders make a stand...Come & Join us from our 'Relative Series of Progressive Sessions' at the Coffee Project EVIA. Click on the link to sign up!

5 comments:

  1. The theme of DIVERGENCE between US Equities and Emerging Markets have been the highlight on top of the PH stock markets decline which has now been overdone with institutional pushing the numbers to the extent where retail investors in the red are more than willing to throw-in towel which corporate buy backs are likewise taking this advantage to buy more from their own shares.

    Meantime, there are only a couple of major companies we have identified that have applied the very same strategies to counter the flow of negative sentiments while staying above waters.

    ReplyDelete
  2. PRICE ACITION: As majority of stock prices struggled on the way down when the PSEI closed at the 7134, it has allowed a probable convergence to occur as stock prices had a considerable distance well below the PSEI levels.

    US Equities triple digit record highs triggers regional moves to do the same as fundamentally motivated markets tend to do overall. That is if and when these upward moves can be sustained towards the end of the quarter. Window dressing activities are underway.

    ReplyDelete
  3. Knowingly Institutional accounts who spearheaded the price rally on Friday knew exactly that the very low price levels were overdone and had taken price extensions well below the averages. Thus resulted into a wider gap of lower prices, low volumes and a declining trend that a price recovery was anticipated.

    However, as reported foreign outflows continued while local investors bargain-hunting took advantage that resulted to a 248+ index point-move for the PSEI recovery closing at 7383. A much thinner volume last Thursday and a blowup volume on Friday where the timing of such market play can be an obvious read for veteran traders and investors. The rally allowed prices to 'converge' upwards to the higher moving average that gained momentum for the day.

    On the other hand, local analyst & traders comments across major broker firms have weighted these as a result of the US Equities record highs as influencing factors for the rally. Not quite convincing based on price action and the 1 day rally since the overall the PSEI still turned negative week on week as of week ending Sept 21, 2018. As the Divergence still exist between the PSEI against the overall stock prices, the major bear trend is widely intact. But the market was successful enough to get the local stock market excited on Friday.

    And Friday's rally narrowed the prices with their respective moving averages as a relief recovery takes place. That also resulted to higher volume turnovers for quick profit taking activities and window dressing towards the closing 3rd quarter trading. Notably, 2nd liner stocks in property sectors with very low volume transaction were in fact the losers for the day for obvious reasons.

    ReplyDelete
  4. Besides, ADB has already revised its economic outlook for the Philippines to a 6.4% growth from 6.8% and likewise a similar revision for 2019 to 6.7% from 6.9%.

    These revisions may also be attributed to inflationary pressures of goods and services, higher oil prices and an increasing account / trade deficit that if not curved appropriately will add more pressure towards a depreciating Philippine Peso which stands already at it 12 year low.

    ReplyDelete
  5. As a result the continued bearish sentiments from a market play recovery have again caught some retail investors and traders flat-footed as the PSEI is back on track lower from where it came from. PSEI is currently at 7205 as of this writing.

    Unfortunately, with these price and percentage adjustments now relatively higher have more room to its original trend leaving individual stocks further to loose value moving forward.

    ReplyDelete