4:00pm Tuesday 30 June 2009 PSEi 2437.99 (-1.218%) PHP/$ 48.13
To say that the Philippine stock market declined by 30.06 points today would not be accurate at all. The market opened strong moving up 14 points from yesterday’s close taking its cue from the strong Wall Street performance. Unfortunately, profit takers sold into the move and what followed was a 46 point spin ton 2436 before closing at 2437.99. A 30 point drop is pretty serious and a 46 point drop means it seriously affects the recent trend.
It is important to see price action when markets are in transition. What I saw today were stock prices that were hitting prices that were attracting sellers. Take AC; it closed 277.50 yesterday and when it traded to 282.50, the market sold it down to 262.50 before closing at 265. FLI closed at 0.72 yesterday, but when it rose to 0.74 in early trade, sellers pushed it down to 0.69 where it closed. It was similar for ALI which opened at 8.60 but was pummeled down to 8.10. It was only TEL that was unchanged for the day at 2395.
What this tells me is that the market is temporarily abandoning the recent upward trend. People are cashing in. The question is, will more of the chips in the market cash in further. I think they will. That is the proper thing to do. In poker, it is called money management. The good poker player is able to stay in the game because he manages money well knowing when to raise and when to fold. My poker playing instinct tells me, I’ll fold for the time being and wait until I am dealt a better hand. I actually reduced exposure in my personal portfolio.
In the meantime, I’ll keep myself in the game by watching how the market plays things out because I still hold to the belief that the index will close 2009 above 2600. I’ll be holding my cards close to my chest and my money even closer. Markets always, and I mean always, gives the prudent, patient and wise risk taker the opportunity to capture fair rewards.