Prices may resume climb on US jobs data

THE NEWS over US employment data for July might spur buying this week although the market might also continue to correct, analysts said.

“The sun will come out [today.] After a week of correction, the good news will reverberate in the region this week and that will affect the local market, allowing the index to move higher,” Astro C. del Castillo of First Grade Holdings, Inc. said.

The US Labor department, last Friday in the US, reported that the unemployment rate fell for the first time in 15 months, easing slightly to 9.4% in July from 9.5% in the previous month.

The US shed 247,000 jobs that month, significantly lower than the 443,000 in June.

The US market reacted positively, taking the fresh numbers to mean the recession is bottoming out. The Dow Jones industrial average gained 1.21% or 113.81 points to 9,370.07.

The Standard & Poor’s 500 index rose 1.34% or 13.40 points to 1,010.48, while the Nasdaq composite index climbed by 1.37% or 27.09 points to 2,000.25.

For its part, the Philippine Stock Exchange index (PSEi) closed the week lower by 0.55% to 2,782.98 after almost a month of finishing in the green. It was pulled down by profit taking that started Thursday.

The local bourse had closed long before the Friday rally in the US.

DBP-Daiwa Securities, Inc. said the possibility of the correction extending to this week is high given the market’s overbought condition.

“The market is expected to consolidate as global financial sentiments become cautious, given the sharp advances of the global market. Investors will be focused on preserving gains as the market heads for a minor correction,” it said.

Since the year started, the PSEi has risen by 48.06%, slightly lower than the regional average’s year-to-date gain of 49.8%, the brokerage firm noted.

AB Capital Securities, Inc. nevertheless said corporate earnings would continue to influence the movement of the Philippine market since the country is not yet halfway through the corporate earnings reporting season.

Positive corporate results coupled with upbeat economic data, DBP-Daiwa Securities said, would limit whatever correction the market might see this week.

Mr. del Castillo shares the same outlook, saying that although there is still room for a correction given the market’s overbought condition, this might be offset by the good news released last week in the US.

“Any correction will be an opportunity for investors to look at certain issues given the changing fundamentals. More and more investors are going back to the market as shown by the growing value turnover,” Mr. del Castillo said.

As of last week, average value turnover reached P3.67 billion, lower than the P5.36 billion recorded in the previous week but significantly higher than the P1-billion mark the market was making at the start of the year.

But whether the market would rally to the 3,000 level is another question, although Mr. del Castillo said given how the market broke above the 2,800 and 2,900 levels in the previous week, anything right now is possible.

“As long as the market will not go up too fast and too soon, investors’ money are safe in the equities,” he said.

“Investors are advised to buy on dips, while the market corrects as overall upward trend has remained intact,” DBP-Daiwa Securities added.

Source: http://www.bworldonline.com

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PSE-Manila Times tourney draws 700
About 700 players have already signed up for the second annual stock market competition organized by the Philippine Stock Exchange (PSE) and The Manila Times, an official said.

The 2009 PSE-Manila Times Equity Challenge is an online stock trading tournament that aims to sharpen the stock market skills of the participants by exposing them to a real-world trading experience—but with the use of virtual money, the organizers said.

“We want to popularize investing in the stock market, which is not just for the rich or for those living in Manila,” said Dante “Klink” Ang 2nd, president and chief executive officer of The Times.

“The stock market is a vital financial intermediary of any economy that is supposed to bring together those with excess money with those who need it,” he added. “The Philippines has the oldest—but weakest—bourse in Southeast Asia, but hopefully we can make a modest contribution in helping change that.”

Jay Peñaflor, tournament project head and senior market specialist at the stock exchange’s Marketing Education Department, said, “We have 700 participants as of press time, most of them professionals.”

He added that many participants signed up for the tournament when it was kicked off in June, but the stock exchange system broke down after a fire broke out at bourse’s office in Ortigas district in Pasig City.

The tournament was relaunched in July, and other interested participants can register until August 31, 2009, Peñaflor said.

The contest runs to the close of trading hours on March 19, 2010, and the contestant with the highest earnings wins, he added.

Source: http://www.manilatimes.net