Philippine Stock Market Commentary

Philippine Stock Market Commentary for February 1, 2010

The Phisix has fallen 78 points since our BUY call on Thursday, January 28, 2010, breaking the 2,900 support level and closing at 2,883.  Despite falling on Friday from Thursday’s close, the Phisix closed higher than its open for that day.  Monday, however, was a downward trend all the way except in the end of the trading day.  The DJIA, on the other hand, is set to test the 10,000 support level this week as intra-day charts show a looming bearish formation, that when closed, will likewise break 10,000.  Recent declines came from concerns about the economy of Greece possibly causing another economic contagion, possible interest rate hikes in the US and China to temper economic growth and weak Philippine fourth quarter 2009 GNP results.  Still, both the Phisix and DJIA have indicators at oversold levels and have come from a correction since the middle of January 2010.  From our previous commentaries, this is deemed as a formation of a significant right shoulder.  Support for the DJIA is seen at the 9,700 level if 10,000 breaks, while the Phisix has a strong support at the 2,750 to 2,800 level established from August to October 2009.  Accumulation is recommended, and we maintain a BUY.

Pymwymi Fund Performance

The Pymwymi fund has fallen 2.1%, while the Phisix has declined by 2.6% since our BUY call last Thursday, January 28, 2010.