Market Skim Through: 17 September

The PSEi gained 0.66% yesterday to close at 6,344.14. Volume was Php10.07 billion. Foreign investors were net buyers at Php 1.34 billion. Steady foreign buying that is unexpected given the upcoming FEM meeting. The natural move was for them to be on the sidelines, but they might be moving already based on what they believe as the amount of tapering. I will still keep my minimum 30% cash position though.

TSI is the center of another sad case of people at Financemanila taking advantage of co-forumers. After a ceiling move, a press release was sent out detailing a rights price way lower than ceiling. This price was predicted by other bloggers, but FMS mainstays continued to hype TSI, one even saying that Emperador/TSI is a future blue chip. There are moneygrabbers in forums, that's a fact. This is now our own version of boiler rooms.  

Other observations: 

BPI is silently recovering (this was out of my radar the past few weeks). Will this go back to 100 PhP soon?

MBT was red, but not terribly red. It was being pushed up every time there's a threat to go below 85. This will be green tomorrow.

BDO now seems the laggard among the top 3 banks. This is still trading [relatively] sideways, will it surge up soon? 

ICT is another of the few stocks that already went back or exceeded its level during the heavenly days at 7300-7400. Investors probably believe the promise of ICT's expansion, operating ports in different parts of the globe. 

In everyone's mind of course is the QE tapering that should be announced early tomorrow. My bet is that any reduction in bond buying greater than 20 B is dangerous to us--another huge sell-off will happen. While any number below 10 B is expected/good; this uptrend/recovery should continue. Between 10B - 20B is a puzzle; we dont know if all the foreign funds will have a unanimous move at this range.  

Market Skim Through: Surprise Surge Up

PSEi increased big by +2.76%, to close above 6,300, at a significant 10 B turnover. Foreigners were net buyers at Php1 B. The % increase is indeed high, but not all index stocks were green.

	Stock Code	Last	Change	%Change	Value
1	RPL	13.1000	-3.8000	-22.49%	11,600
2	SMC	65.5000	-7.0000	-9.66%	21,079,783
3	I	2.6200	-0.2400	-8.39%	15,720
4	PHES	0.4300	-0.0300	-6.52%	107,500
5	VMC	1.6000	-0.1000	-5.88%	14,338,980
6	CHIPS	14.0000	-0.8000	-5.41%	51,550
7	ZHI	0.3700	-0.0200	-5.13%	235,350
8	LC	0.4400	-0.0200	-4.35%	28,200,350
9	STR	3.6300	-0.1600	-4.22%	145,350
10	MA	0.0270	-0.0010	-3.57%	13,591,900
11	HLCM	13.0000	-0.4600	-3.42%	65,000
12	BEL	4.7800	-0.1600	-3.24%	96,947,010
13	BKD	1.0700	-0.0300	-2.73%	219,350
14	STI	0.7600	-0.0200	-2.56%	14,125,410
15	MER	268.0000	-7.0000	-2.55%	511,089,210
16	T	2.2400	-0.0500	-2.18%	12,740
17	ARA	1.5000	-0.0300	-1.96%	217,160
18	COL	17.5000	-0.3000	-1.69%	2,765,048
19	SEVN	105.1000	-1.8000	-1.68%	1,398,312
20	SLI	0.6100	-0.0100	-1.61%	323,730

SMC is now officially behaving like a bazur, or a poor-performing second liner like ROCK. It is the 2nd worst performer at - 9.66. I wonder what Ramon Ang will say again about taking SMC private (it is rationale). Will he brandish again the chunk of Meralco he can still sell, just so he can show liquidity?

Foreigners CLSA and Deutsche sold big at closing, and power companies are seemingly hit. MER and AP, for example were positive throughout the day but suddenly closed in the red at closing.  Are these brokers worried about another move by the government ordering another slash in utility tariffs (for electricity this time after water)?

The bulk of the increase in the index was courtesy of SM, MBT, MPI, and SMPH, which all rose big.

	Stock Code	Last	Change	%Change	Value
1	SUN	1.5700	0.1900	13.77%	15,305,640
2	ATN	1.1800	0.1300	12.38%	141,560
3	CDC	1.1200	0.1100	10.89%	5,600
4	EVER	0.2650	0.0260	10.88%	17,600
5	IPO	12.5000	1.1800	10.42%	398,946
6	CPG	1.5500	0.1400	9.93%	45,751,090
7	SM	805.0000	61.5000	8.27%	980,861,995
8	AGF	2.8100	0.2100	8.08%	2,751,110
9	ALHI	23.4000	1.6000	7.34%	64,655
10	APO	1.9800	0.1300	7.03%	1,980
11	NXT	2.1500	0.1400	6.97%	38,670
12	CEB	55.5000	3.0000	5.71%	18,150,905
13	OPM	0.0190	0.0010	5.56%	39,800
14	KPH	4.7500	0.2500	5.56%	28,300
15	MPI	4.6300	0.2300	5.23%	298,078,170
16	MBT	86.0000	4.2500	5.20%	506,718,473
17	SMPH	16.9800	0.8000	4.94%	234,222,736
18	PAL	5.7700	0.2700	4.91%	469,106
19	IMI	2.6000	0.1200	4.84%	391,410
20	GEO	0.4350	0.0200	4.82%	8,800

The 1B foreign buying is small for comfort given that we reached 10 B in total volume (their buy figures are usually higher at this total volume). The culprits are again Deutsche and CLSA, which combined for over 2.5 B of selling. Good thing other foreigners and local neutralised Deutsche selling in SM, for example. And again, a big chunk of the sell-down, of both brokers happened at closing (which, incidentally I think is better than gapping down at opening, because panicky locals frequently follow gap downs with some immediate sell-downs of their own, making a painful chain effect).

All these were surprises. Majority were expecting sideways, low-volume trading, and sell-off by many funds to prepare for the FED meeting. We can only wonder what these funds are planning for near-term (how do they intend to position throughout September) and intermediate (until Dec 30). We must be aware of their moves until Wednesday, and change action plans if needed.