8:50 am Monday 1 August 2011
It is the start of a new month, and if one wanted to start a clean slate, he or she should just mark stock positions to market in order to proceed to the new month with a fresh outlook. Two things face me this morning. The first is the start of what people term as the “ghost” month.
Actually, when I lived in Hong Kong and Singapore, the term used was ” month of the hungry ghost” which was the 8th month in the lunar calendar. From what I remember, the belief was that in the month preceding the full moon of mid-autumn, the ghosts of the ancestors hunt around for things to consume because more than half the year was over. Their relatives put out food and burn incense together with fake paper money as a ritual to appease the hungry spirits. This all ends when the full moon of the 9th month appear when many go out with their mid-autumn lanterns to greet the full moon. The second is the more immediate “debt ceiling” impasse in the U.S. which threatens financial markets world wide.
I had been away over the past few days attending a networking conference in Phuket, Thailand with the stock exchanges in the region. What I think they find enviable was that our markets had been quite firm despite weakness in the global during the week that passed. What I think they find a bit disappointing is that our market is a fraction of their markets in terms of number of issues listed and value turnover. Thailand sees the equivalent of more than US$ 1 billion traded everyday. The Vietnam Stock Exchange which had only 2 issues listed in 2002 has around 1,000 issues listed today. The PSE only has 294 listed issues as of today. What is also enviable is the advancement of trading technology in Singapore, Malaysia and Thailand. Their level of on-line access is so overwhelming that I can only expect that in due time, our own local on-line traders will eventually be attracted in trading those markets.
Do not get me wrong. I am not that impressed with Thailand itself. The networking conference was held at the Phuket Hilton which had sprawling grounds and you could cross the street to a very long beach. Actually, I left Thailand thinking that Thai cuisine was over rated. I was at the Marco Polo in Cebu the previous week and the food was miles better than what we had in Phuket and even less expensive. All the buffets at the Phuket Hilton paled in comparison to the buffets that I had in the Cebu Marco Polo. The service was even much better. Imagine, there was not enough hot water when I was showering at night before going to bed. I my late friend, the former president of Hilton International, heard this from me, he would be turning over his grave.
There was one insight that I got during the conference presentations. It was that among the stock markets in the region, the Philippines was the only market with a good selection of mining stocks. It was apparent that in the countries of ASEAN, it was only the Philippines that had the most abundant base and precious metals mineral resource. We are to ASEAN as Australia, Canada and South Africa is to the global market. The Philippines can actually be then mining sector play for the entire region if we are able to present our market properly to the region’s investor base.
As I write, the U.S. congress appears to have come to some agreement on the bi-partisan caucus level. Hopefully, the agreement can hurdle the plenary vote tomorrow. Japanese and U.S. stock futures surged on the news. Our market may follow suit this morning.
Anyway, I will have more to say later on. In the meantime, I just have to make my official summary of the business we can expect from the stock exchanges in the region.