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PSEi: It’s Going Down

Sit tight. Keep watch. Pray. Winter is coming.

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The year-to-date performance of our stock market has been not as encouraging as expected. Truth is, it has been going down since it peaked sometime in April. We are much lower from our short-term moving averages, MACD still points to a downward trend while RSI is also weak albeit some recent recovery.

We are tiptoeing a crucial 7500 levels and who knows where we’ll be if 7500 does not hold. The general global economic condition as well as the economic state of our beloved country has not been too favorable as well. Some probable reasons pointed out by analysts for the lackluster performance of PSEi are as follows:

  • Weak 1Q GDP results of PH. Market and analysts were expecting a much higher growth figure
  • Weak 1Q corporate results. Same thing, lower than expected
  • Continued net foreign selling. Dubbed as smart money, foreign funds have been letting go of our stocks for something else somewhere else. Why o why?
  • Politicking ahead of 2016 Presidential elections. Expect this to get worse in the months to come. Questions are, (1) will government still be able to push for economic growth this year amidst all the election circus; (2) will there be continuity, whoever runs and wins in 2016?
  • US and its telenovela Fed meetings on when they shall increase rates. We’ve been expecting this since 2 years ago and yet, Fed rates have yet to take off
  • Jittery PH-China-Rest of Asean (+ US and Japan) relations due to territorial disputes
  • A black swan event perhaps such as, God forbid, a mega Manila earthquake, especially since our neighboring countries have been experiencing tremors the past few months
  • Greece and its debt negotiations with EU

Who know’s where the market is headed? If I did, I wouldn’t be suffering losses with my investments, right?

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Those who have cut loss rates (e.g. -8%) might have hit this by now, so the question is if they followed their trading rule on cutting losses and were able to get out, sitting on their cash positions; or they were too emotional to let go, hence in a deeper bleeding hole.

Those who still have cash bullets, I suggest you hold your fire, stay put and wait for better signals.

Those who are in a regular investment plan, then just keep it. I assume your objective for opening such is long term, hence this downtrend is actually a chance to average down.

Prepare a list of stocks that may benefit from the upcoming elections. Historical elections will tell you this. Maybe stocks on media and consumer goods? But don’t buy in yet. Monitor these closely.

Sit tight. Keep watch. Pray. Winter is coming.

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About Geri (359 Articles)
Founder and main author. Husband, used-to-be-breadwinner, God-made multi-millionaire, employee, financial planner and adviser, investor, stocks trader, entrepreneur, agri-preneur, book author. Firm believer that all Pinoys deserve a richer life. Not a guru, but a forever student of the investments world, a work-in-progress.

6 Comments on PSEi: It’s Going Down

  1. In every investment, consider your OHA. Objective, Horizon and Appetite. PSEi may be going down lately (though some recovery this week due to better news from Greece), you have to consider why you are investing in BPI UITF, for how long do you plan to stay invested and what for?

    For me, I plan to use the UITF for my kid's college education (16++ years from now) and retirement (35++ years from now) so I have been buying UITF while PSEi was downward.

    I didn't buy much stocks though during the same period as I have a different objective for that investment. Goodluck!

    Like

  2. Hi! Raniel here, I'm actually enrolled in BDO UITF for almost 2 years now and I'm planning to open same UITF account with BPI this coming August until then I managed to go over this site and found out the current situation in PSE, so I’m now hesitating if I will still pursue to start investing with BPI. Would you give me some advice?
    BTW, I learned a lot reading some articles/post on this site. Add me up as a regular visitor. More power!

    Like

  3. Hi! Raniel here, I'm actually enrolled in BDO UITF for almost 2 years now and I'm planning to open same UITF account with BPI this coming August until then I managed to go over this site and found out the current situation in PSE, so I’m now hesitating if I will still pursue to start investing with BPI. Would you give me some advice?
    BTW, I learned a lot reading some articles/post on this site. Add me up as a regular visitor. More power!

    Like

  4. Thank you for the kind words. Appreciate it. Goodluck and God bless on your investments.

    Like

  5. Thank you for the kind words. Appreciate it. Goodluck and God bless on your investments.

    Like

  6. Thank you so much, Geri! I just enrolled in BDO EIP. Your site is such a big help for newbies like me.

    Like

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