November 8, 2007 Report

Market Commentary

With another sharp nosedive on the Dow last night (closed at 13,300, down by 360 points, or -2.64%), it was inevitable for the Phisix to follow suit. Today, our closed weaker at 3,692 , -96 points down and tracking the Dow's percent fall, we were down by -2.54% from the 7th.

Looking at the Actives List is like looking at a sea of blood. Everything was red, except for, surprise surprise, Dizon Mines (Ticker DIZ). I joined in the fray today, but did not day trade. My broker was right (hopefully), in that if the market is down but this one is going up, there could be further support tomorrow. Although on hindsight, I forgot tomorrow's a Friday. So I might exit my position in Dizon tomorrow.

(I have written about the weekend factor. Please view it here.)

So far this year, buying opportunities arose during exactly times like these, when everyone is selling. Remember, most of the times, when the market nosedives, some people join in the selling because of panic. It is when people panic that there is a possibility of buying into shares at good prices.

The biggest drags for the market were AC, TEL and MEG.

Keep an eye on oil prices. We are near $100 a barrel already. If it breaches 100, this will definitely mean even higher prices. Time to go back to riding the jeep. There was a good comment last night by the lovely Erin Burnett on CNBC, traditionally stocks went down when oil prices went up. This time around, stocks were going up AS oil was rising. So we wonder, what will happen to the stock market when it goes past 100?

I just wonder, will super oil laggards OV, OPM and PERC start to move already????????

STOCK

I'm putting DIZ here. Tomorrow will complete the 3-day run-up that usually happens for stocks locally. If you've been actively trading this year, there seems to be a unique pattern across all basuras. Most of their prices went up for three consecutive days, then kaput.

I'm not saying it's a buy, just keep this on your monitor and have that mindset of profit taking. This means that if you are only buying in tomorrow, be sure not to forget to get out fast.

If you have the balls for it, try looking at AJO. It might have a slight rebound tomorrow. Buy somewhere at 0.15 or 0.155. Just remember to get out fast too.

Other picks I chose for the week were the ff. These are listed as stock, closing price, +/-% vs previous day's, top 2 buyers. I've added comments if applicable.


PA 0.21 / -4.55% / Goldstar RS Lim (Still trading within a tight range. Too late to remove this from the list since tomorrow is the last day for the week. These top buyers are traders. GS's average price was 0.215, RS Lim's at 0.21. If you are going for a longer trading position, 0.205 or 0.21 could be good support prices)

FGEN 60.50 / Flat / JPMorgan Deutsche (3rd day of Foreign buying. These are BIG foreign brokerages, so they are probably seeing something we don't. Not only that, you have to realize that a large cap like FGEN, holding stable despite a bloody day like today is a BULLISH sign)

STUCK

I am displacing AT from here to SUCK.

TBGI. Despite the weaker close of the market, this basura managed to stay afloat at 3.00, although down by -1.64% from yesterday which was at 3.05)

SUCK

Oil is making record highs once again. The resistance is probably around 100. There are two scenarios, one is that it breaks it, the other is a strong pullback for oil. This will have serious implications for those holding on to mining stocks. So just be wary.

In terms of Php value
Deutsche sold -203M
CLSA sold -163M
UBS sold -195M

Even Philequity was net seller at the following:
PEP sold -163M
Wealth sold -258M

Only JPMorgan was a net buyer at +287M

For newbies, foreign buying and selling has a serious implication on the direction of the market. So this should always be on your list of things for monitoring.

Friday tomorrow. Don't forget the weekend factor.