The P7.75 billion value turnover managed to push the PSEi to a new high of 6,542.51 despite the defeat of the Advancers in the hands of the Decliners (72/84). Non-index stocks also participated in the surging force evidenced in the new high achieved by the PSE All Shares Index at 4,103.86.
McDonalds franchisee in the Philippines, Allied Global Group Inc (AGI), topped the most favorite stock of the day with P615.09 million value traded. Its price dropped 2.88% though at closing.
ANALYSIS
Lately the surging force continues to gasp every around two days, indicating that despite the huge investment money invested in the stock market, the bullish pressure is getting weaker and unsustainable. The investors simply are not as bullish anymore as some of them preferred to hold long-term. Traders can only push the market to new highs to a certain point. Only growth stocks seemed able to keep on gaining new grounds when liquidity is high.
The A/D Ratio of 0.86, the weak surge in PSEi High, and the stronger surge in the PSE All Shares Index indicates a potential dip in PSEi tomorrow with trading focused primarily among non-PSEi issues. Value turnover may dip to P6.0 billion.
RECOMMENDATION
Long-Term Investors
Except for those who stayed cheap during the recent bullish surge, no new cheap stocks are expected to appear tomorrow or in the following week, unless a drop of PSEi to 6,000 happens. Stocks are still generally overvalued. Keeping some cash ready for that proverbial "rare elephants" maybe a wise thing to do.
Short-term Traders
Certain issues, particularly the speculative stocks, continue to behave with wide swings. There is still a respectable profit to make there at this level. But it would be harder to do this time than late in 2012. Depending on your trading capital, single-digit stock prices may be better alternatives for a trader to speculate with rather than the double- or triple-digit priced ones.
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