Miko's Blog for
May 31, 2011 (11:50 p.m.)
market is now the wild, wild west! Plenty of things happening all at the
same time this morning - Worst than expected GDP report, Congressional
Hearings on the TEL-DGTL deal, MSCI re-weightings and Dow Futures up
strongly. The result - some stocks are down significantly while some
stocks are up significantly. Market was down by 50 points, yet, there
were more advancers than decliners. Foreign funds from ATR were heavy
sellers today, yet, new entrant Credit Suisse was seen quite aggressive
on the buy side instead.
have absolutely no idea where the market is going now and everything now
seems like a toss of a coin. What may be strong now may not necessarily
be strong tomorrow and what may be weak now may not necessarily be weak
don't know whether to buy what's low or what's strong. Do you buy and
hold or just play contra and get your 5% gain. Do you cut losses or do
you just hold and pray that it comes back? Do you buy the blue chips or
do you start buying basura? Do you even buy something or just let go and
trade when the market becomes easier?
sure hope we can get out of this range soon. I don't mind if we breakout
above the range or breakdown below it. Just get the hell out of here!
May 30, 2011 (11:45 p.m.)
Although value turnover today was a mere P3.2 billion, foreign funds
were net buyers today by almost P300 million. That's the good news. The
bad news is, the market is losing momentum as it approaches its previous
high at 4344. I think we'll continue to be range-bound for now.
Mining did a short-term u-turn today but it might just lead to a
consolidation in the short-term. My beloved AT wasn't spared despite
news that its Berong Nickel Mines would finally start full production by
mid-June. Toledo Mining Corp., which owns 56% of the Berong Nickel
Corp., was up by 32% in the London Stock Exchange last Friday. AT owns
25% of Berong.
There was some activity in ICT today. Don't tell me they'll put this
back on the MSCI Index.
basuras are quietly moving. I miss those days when basuras go to the
ceiling price. It's now a thing of the past as the PSE has made it an
SOP to investigate all stocks that reach the ceiling. Market players are
now purposely avoiding letting the price go the ceiling so as not to get
investigated. Notice how BC almost went to the ceiling last Thursday but
did not. If only you can short-sell here in the PSE, just short-sell any
stock that goes near the ceiling price.
May 28, 2011 (3:30 p.m.)
two days ago, I was almost certain that we've already seen the end of
this three month rally but, after what happened in the last two days,
I'm no longer quite sure. I guess this behavior simply describes the
market this whole year - erratic. Don't worry, even the foreign funds
are as clueless with the direction of the market as all of us are.
speechless with URC. I saw TEL climb even higher than its price before
its ex-cash but there was an underlying reason why it did that. For URC,
profits are down significantly for the quarter, yet, it still managed to
climb above its price before ex-cash. There has got to be some good news
forthcoming on this one.
buying frenzy occurred in PX today primarily because of its announced
property dividends in PX Petroleum. I knew prices would go up but a 9%
rally doesn't seem justified to me, that is, if the stock is merely
rallying because of the property dividend. Why? Because the number of
shares that you will get is just so little and PX Petroleum isn't really
worth that much, if I'm not mistaken. Anyway, congratulations to all
those who followed my newsletter and bought PX the other day. I myself
bought PX the other day but sold all of it yesterday on the spike. I
used the proceeds to buy more of my beloved AT! :-)
went to Boracay last weekend to attend a wedding of my former colleague
in HDI Securities, Mr. Aaron Lee. If you want to see the prime movers of
HDI Securities when I was still there, below is a picture of them while
we were at the reception of the wedding. From left to right: the
dashing, Mr. Aaron Lee; the debonair, Mr. Mike Chua; my former boss and
Mr. ACR himself, Mr. George Cheng; myself; and, the Playboy, Mr. Rey
The Whipsaw Kids
May 26, 2011 (8:30 p.m.)
Finally! After 5 days of hell, there is light at the end of the tunnel.
The question is, is the light that you are seeing the light leading up
to heaven, or, is it just the flashlight being held up by your
salute Gokongwei in URC. He certainly made a lot of people very happy
today. This is one of the very rare instances wherein prices continued
to climb even after the ex-cash date. Congrats to all believers!
Except for PX holders, I bet a lot of people got quite disappointed with
mining today. There was a disclosure on PX today regarding a 5 centavo
cash dividend and a property dividend. At first, I thought it was
nothing, then, I realized, the property dividends are actually shares of
Philex Petroleum, which will be listed by way of introduction in the
PSE. Congratulations to all believers!
Something peculiar happened today that hasn't happened for a long time -
Basura moved! Some notable basuras that moved were BC, ISM, BHI, DIZ,
MRC and NI. Could it finally be time to get naughty? Or is it a sign
that we are really in the end?
May 25, 2011 (8:00 p.m.)
place to hide in this market except in mining?
don't have LC but I'm quite surprised that this is still holding above
its support. Could it be that this is "the real thing"? I bought back
some AT again today.
Can't understand why, after being quite weak yesterday, URC suddenly
surged higher today, which is a day before the ex-cash of its P1.90 cash
dividend. Why would people buy it at 41.50 when prices already climbed
up by 1.60 today and 3.40 since the day when they announced the
dividends. Surely, people know that prices will also adjust by 1.90 by
tomorrow. Had URC not announced the dividends, the stock may already be
trading at 35.00 by now.
After 6 months of consolidation, could it be that AGI has now finally
broken out of the consolidation and is now in a (down) trending phase?
Could CEB be a "buy" now? Why? Because, with the condition of the market
now, I bet a lot will now be going to Boracay (hehehe).
friend of mine told me to sell in May and go away. Unfortunately, he
went away but he didn't sell. :-)
May 24, 2011 (9:00 p.m.)
more place to hide anymore as everything has begun to drop. We're still
trading above support but, if the bulls are still going to stay alive,
prices will have to hold right now.
Andrew Tan stocks were once again the highlight of the day. Yesterday,
it was MEG that was sold down aggressively. Today, it was AGI. What's
with Andrew Tan?
thought LC was still going to be immune from the bloodbath of the market
but, unfortunately for the bulls, some foreign brokers (not foreign
funds), have begun to sell down aggressively. I wonder if those foreign
brokers are actually Lolo himself.
turned ex-cash today on its P10.00/share cash dividends. Some people
were holding this one simply because of the cash dividends. Now that
people got it already, who's going to be willing to buy higher? I was
quite bullish on SCC a few weeks ago, thinking that prices were already
trading at its medium-term support at around 206.00, however, with the
stock unable to rally and is still trading at current levels, I am
starting to think whether this stock will still be able to hold above
its support or begin to trend down. URC is acting the same way - bullish
until ex-cash only?
After scanning all the charts in the market this afternoon, I hardly
found anything left that was still trending up. Most are now either
trending down or moving sideways. Mining is the only sector left that is
still trending up, however, given how much they climbed up already,
would it still be a good idea to buy into the sector? How about if we
just buy the lowest (weakest) sector of all - properties. Or, why don't
we just buy nothing at all and wait for the market to drop to 3900? Your
guess is as good as mine.
May 23, 2011 (9:00 p.m.)
feel like a shmuck with the market dropping back down to 4260 after
stating that it looked poised to trend towards 4600 already. I knew the
market was going to make a big move soon and I kinda guessed that it was
going to be up. Could I have guess wrong? I hope not because, if I
guessed wrong, then, that means that the big move will be to the
Although the PSEi simply looks sideways, there are a lot of stocks that
are breaking below their support. Foreign funds were net sellers today
by P600 million despite value turnover dropping to just P3.6 billion.
Sell in May and go away?
all my AT today. I was hoping that mining would be immune to the
bloodbath because of the rise in Gold but, unfortunately, mining isn't
exactly following Gold but is also getting affected by the general
and OPM is currently the flavor of the day but, in this kind of
environment, would there still be anyone willing to buy higher?
was the big victim of the market today. There might be others coming.
I'm very concerned about all those stocks that are currently moving
sideways and in a tight range right now because these are the ones that
could potentially be like MEG today.
you can probably sense in my writing today that I'm quite wary of the
market. My best indicator is when I was very, very confident to say that
prices will continue to trend up towards 4600 a few days ago, only to
see prices fail to climb as I expected. That failure to climb may
probably be a sell signal in itself. Objectively speaking though, still
sideways as long as 4200 holds.
May 18, 2011 (8:00 p.m.)
about an "Island Reversal" as ICT gapped down today right after gapping
up yesterday. I heard that its inclusion to the MSCI index was reversed
this morning. DMC, on the other hand, gapped up after gapping down
yesterday but will it be included to the MSCI index? I feel sorry for
DBP-Daiwa in ICT and all those who got stuck at yesterday's prices. Mr.
AB Cap though did a very good job in shorting his position in the stock.
Mining is once again "in". I can't believe Lolo is still alive though up
to now. I meant the stock. It's anybody's guess when this party will end
but it certainly feels like it's getting more and more crowded everyday.
beloved AT, on the other hand, was the weakest mining stock this morning
as Deutsche Regis was a "killjoy". I guess this one is trading in a
different cycle from the rest of the pack.
Banks such as MBT and BDO are now leading this market higher. Could we
already have formed a bottom today at 4260?
Fearless forecast - Foreign
funds will buy above 4400 ... 4600 coming!!!
I'll be out of town by tomorrow, thus, my
next blog entry will already be on Monday.
May 17, 2011 (9:30 p.m.)
bet there were as much people who were jumping for joy this morning
because of ICT as there were as much people who were getting depressed
because of DMC. A lot of people were expecting DMC to get included in
the MSCI Index so, when it was announced today that it wasn't, people
got disappointed and sold. On the other hand, I don't think anyone
anticipated ICT to be the "anointed one". Interestingly, while there was
heavy foreign selling in DMC, there wasn't heavy foreign buying in ICT.
There's been so many gap downs already this year - DGTL, SMC, AGI and
now, DMC. Amongst those issues, only AGI was able to recover. I'm not
sure about DMC because it obviously broke below a very important support
Mining continued to dive today for a third day in a row. Even my beloved
AT wasn't spared from the bloodbath. However, notice that MA and LC
dropped by 4 to 8% today, PX dropped by 3%, and AT dropped by only 1.5%.
Aside from ICT, the only rose among the thorns was VLL. For the last
couple of weeks, I've been noticing that, despite all the property
issues dropping, VLL has continued to hold its ground and trade at its
highs. No one seemed to be noticing it up until today. I guess Manny is
really bent on making up his lost fortune during the elections in his
companies. Its earnings came out this morning and was better than
expected. Annualized P/E comes out to about 7.7x, which makes VLL the
cheapest stock in the entire sector, if I'm not mistaken. 52-week high
is pegged at the 3.68 level. Let's see if it can make a run towards that
level. Didn't JAP used to play this stock?
Congratulations to all those who followed my newsletter and bought VLL!
May 16, 2011 (10:00 p.m.)
PSEi continued to be very resilient and doesn't seem to care about the
world markets. Still, if you bought the wrong stock, you could have lost
money today as decliners beat advancers by 7 to 5.
big story of the day were the Oil stocks led by OV. I don't know what's
up with these issues but "Bonita" does sound quite alluring.
First, there was AT. Now, OV. Could it now be the Fred Ramos show? If
so, will VUL and UPM follow? I'm contented with the main event though -
have to admit, I'm quite surprised that LC is still holding above its
ground. The behavior of MA today though was more within my expectations.
still can't quite understand why FGEN is continuing to trade at its
highs, yet, EDC is now testing its critical support at 6.50 to 6.55. I
think someone is making a wrong call. Either the bulls of FGEN are too
optimistic, or, the bears of EDC are too pessimistic.
May 15, 2011 (8:30 a.m.)
the Nth time, could this finally be the end of the "once a year Lolo
run"? The last couple of times that I have been guessing that the LC and
MA run were over, prices continued to defy gravity and continue with its
phenomenal run. This time though, there is something a bit different
that is happening - metal prices are on the way down.
While most mining stocks seemed to have reached a medium-term peak last
Friday, it might just be a short-term peak for but one stock - AT.
The company declared P705 million net income in the 1st quarter. This is
a big turnaround from its income last year of just P145 million. At this
rate, P/E ratio of AT would just be a mere 7x and would now be the
cheapest mining stock in the whole PSE.
to put things into perspective, PX has a market cap of P97 billion and
earned P1.3 billion in the first quarter. AT currently has a market cap
of P19 billion and earned P705 million in the first quarter. Thus, PX's
P/E ratio is 18x while AT is 7x. The main difference between the two is
that AT will not be able to declare dividends for now until it has wiped
out its deficit. PX, on the other hand, has a cash hoard. Of course, if
AT is indeed a turnaround story and continues to earn this much in the
coming quarters, by the time it is able to declare dividends, the stock
could potentially reach the market cap of PX as well.
Let's not compare AT to LC and MA anymore because I am only talking of
companies that are actually making money. By the way, LC now has a
market cap of P38 billion but lost money in the 4th quarter.
1st Qtr Earnings
unannounced yet but likely negative
unannounced yet but likely negative
Technically, LC and MA seems to be at or near a medium-term peak
already. PX is also overbought but may still continue to climb higher
after a pullback. AT, on the other hand, have just broken above its
consolidation and may just be at the beginning of an uptrend. Refer to
the weekly charts below:
Technical Analysis (Weekly Charts)
Rebounding off its support
Overbought but may still climb
Consolidating within a sideways to upward trend
Sideways to Up
Trade the range
* NIKL may reach 27.00 but prices
must no longer break below 21.00.
Personal Disclosure - I am
currently holding AT.
May 11, 2011 (10:00 p.m.)
we go again. First, there was DGTL, then, came SMC. Now it's LC/MA/PX's
turn to get suspended because of a disclosure. I'm quite certain that
the disclosure will be good news, however, I'm just not so sure how the
market will react to it. For the sake of the bulls, I just hope this
isn't another DGTL or SMC, if you know what I mean.
While everyone is busy trading either LC, MA or PX, no one seems to be
minding AT, which has been the laggard in the last few weeks. Today
though, AT was the star. Could this be the start of something big?
do RFM, PIP and URC have in common? They are all in the food sector and
all their earnings dropped significantly from a year ago. I guess the
rise in commodities have something to do with it.
Someone in Nieves Securities must be very "pikon" with TKC Steel. He has
been selling and selling for the last one and a half month. Today, he
sold a whopping 7 million shares at 3.00. Could the stock have
There were three big caps that were very strong today - DMC, JGS and
FGEN. What do they have in common? Answer - Deutsche Regis
May 10, 2011 (9:30 p.m.)
that it for SMC? Although the big seller in SMC is no longer selling,
ATR wasn't a net buyer anymore today. I don't see the RSA brokers buying
aggressively so who's going to buy higher? I wonder who's buying thru DW
Capital though. He seems to be the only big buyer left. Can he absorb
P10 billion worth of shares? I don't know but I'm just not too
optimistic on SMC for now until all that overhang from the secondary
offering has sold.
think quite a number of Tsupiteros got caught flat-footed in LC today.
Could the party be over? When stocks like LC or MA generates P500
million of value turnover a day, you have to be very, very careful.
Vintage JAP in GEO today. I miss those days.
PSEi looked very, very strong today but 20 points out of its 45 point
upswing today was simply because of TEL. Nevertheless, I think that low
at 4170 was very well supported by the bulls.
May 9, 2011 (8:30 p.m.)
After mumbling all that non-sense about who's going to buy SMC above
110.00, ATR Kim-Eng, who was the big seller of SMC below 110.00,
suddenly became a net buyer today. I completely forgot that, if there is
anyone who's going to buy SMC above 110.00, it's going to be him. I
wonder if the seller is the same fund as the buyer today. Can you just
imagine what the fund manager of that fund is feeling right now? At
116.60, that fund just lost more than a hundred million pesos already
just keeps on going at it as both LC and MA continue with their
parabolic rises. I don't think I even remember the last time that LC had
a value turnover of more than P500 million. Lolo must be the happiest
person in the planet right now. Congrats Lolo!
been wondering when JAP was going to make his move. I guess, after what
happened with LC/MA, he just couldn't take it anymore (haha). A
disclosure came out this morning regarding some P952 million worth of
private placements in GEO at P1.00 per share. Believe it or not!
Another group of stocks, which are also on the move right now are the
Gokongwei issues. Last Friday, it was CEB that was leading the move.
Today, it was JGS. Could URC be next? Notice though that RLC continues
to be very weak. The entire property sector is now the laggard in the
was right in AP. Buy on bad news. PNX seems to be acting on the same
psychology. That 15.24 high though will not be revisited anytime soon.
May 8, 2011 (8:30 p.m.)
would have thought that the "jackpot" was actually going to be in Lolo
stocks? I have hesitated and hesitated to enter his stocks because of
his reputation in the market. I made some money at the beginning of the
move but I took profits way too early. I never re-entered again this
past week, despite my technicals telling me to do so. Moral of the story
- try not to have a bias with anything in the market. My hats off to
Lolo. Congratulations to all miners of Lolo! ... my opinion on Lolo
stocks now though - No more buying on dips. You either buy it right now
at these prices or you don't buy it anymore.
still quite puzzled why these foreign funds sold their SMC shares below
the 2PO price. I've heard a couple of conspiracy theories already but
the best one I heard was because some funds decided to convert their
shares to bonds. The bonds will be convertible on 2014 at P137.50 per
share, if I'm not mistaken. They lose 2% by selling at 108.00 but still
make a gain because of the higher interest on the bonds. If they get
lucky, they can even sell above 137.50, three years down the road. By
the way, can somebody tell me, who the hell is broker 311?
announced that its earnings dropped by 31% in the first quarter compared
with its earnings in the same period last year. As early as last
Wednesday, I anticipated that the company will report bad news simply
based on its price behavior then. By tomorrow, the market would have
fully discounted the news already. Could this be a buy on bad news?
Everyone was looking at the mining issues last Friday but did anyone
notice that Gokongwei is now on the move?
looking at all the commodity charts and it appears that they have all
formed medium-term peaks last week.
May 5, 2011 (10:00 p.m.)
big story of the day was SMC. To say that this went below expectations
is a big understatement. Yesterday, I was even contemplating on whether
I would sell at 125.00 or not (haha).
big question on my mind is, why did these foreign funds sell below
110.00? Obviously, these funds did not buy on the board and only bought
on the secondary offering. So what changed between two weeks ago and
big problem now for the bulls is that there were so much people who
bought the stock today below 110.00, P3.69 billion to be precise.
Everyone who wanted to buy this stock were able to buy it today. So,
who's going to buy higher than them? Will RSA spend the P12 billion,
which he received from the offering to push the stock up and make
everybody happy? That certainly will not make sense. Take note, the
trading participants were only allotted P800 million worth. The rest of
the P12 billion worth of shares were allotted to the foreign funds and
some people who went directly to the underwriters to ask for shares.
Foreign funds were net sell by only P2.4 billion today, will they
continue to sell their shares below 110.00?
really pity those people who got stuck at much higher levels. Unless a
miracle happens, I don't think there will be any chance at all that this
stock will go back to 150.00 anytime soon. I hope the PSE has learned
its lesson in this 2PO. I know the PSE probably meant well by suspending
the stock but, in this case, it probably did the public much worse. Had
the stock not been suspended, some people would have gotten out of their
positions before all hell broke lose.
Would you invest in a stock market wherein your positions could be
suspended by the PSE and gap down by the time that it resumes trading.
If I were a foreign fund and there is a risk of this happening, I would
not invest in the PSE anymore.
message to the PSE - Stop those damn suspensions!
what do I make of RSA? He stated several times that he will do a
secondary offering at 150.00 to 200.00 and even stated that he might do
it at P250.00. The offering was set at 110.00. You be the judge.
May 4, 2011 (10:00 p.m.)
Despite the Dow trading at overbought conditions, it refuses to correct
even as of this writing. Some Asian markets though have started to
Despite most mining issues dropping already today from the sky, Lolo
stocks seem to be immune. Somehow, although the charts don't look
bearish, I just couldn't get myself to buy those anymore at these
levels. Good luck to all those who are holding.
Lopez stocks have been the darlings in the last few weeks but, in my
opinion, targets have already been achieved for those issues.
was very, very surprised when AP behaved extraordinarily weak today.
After looking very strong already the last couple of days and,
especially, yesterday, I was thinking that prices would just correct a
bit today and continue to trend up going towards its analysts' briefing
on Friday. Obviously, based on its behavior today, there might be some
worse than expected news on Friday.
don't know if you've noticed but all the "listings by introductions"
last year seemed to have bottomed-out already in the medium-term.
Finally, tomorrow will be the much awaited listing of the SMC 2PO. I
expect that to open at no less than P120.00 by tomorrow.
May 3, 2011 (3:30 p.m.)
Yawn! Not much going on in the market now as value turnover drops below
P4 billion. I'm not quite sure where we are going next. I guess the
market doesn't know what to do next as well. Big move coming up though
either up or down.
concern right now is Dow seemed to have peaked last night. I think Gold
is at or close to a peak as well. Anyone saw Silver?! That one may have
gone ahead of the pack already.
market movers are trying to jumpstart ANI and CPM. I want to see if
people "other than them" will follow.
Confusing behavior on LC today. Could they be "distributing" already? I
wouldn't be surprised if the play shifted to MA instead.
those who are trading LR, I suggest you watch GERI. And for those
trading GERI, watch LR. Look at their charts. They are twins.