ACCORD CAPITAL EQUITIES CORPORATION
GF EC-058B East Tower, PSE Center, Exchange Road, Ortigas Center, Pasig City, PHILIPPINES 1605 (+632)687-5071 (trunk)
DAILY WRAP & OUTLOOK _ TD113-114 _June 10-13, 2011
PSEIPts Change% ChangeVolume ValueAdvancersDeclinersUnchanged
MARKET WRAP & HIGHLIGHTS OCAL share prices failed build on early gains anddefied trends across the Asia Pacific region asinvestors remained jittery ahead of next week's Monetary Board meeting.
The main Philippine equities index slipped -4.76 points to settleat 4,219.58 at the close after surging by as much as 24 points off the opening bell. Optimism marked the start of trades followinga mild-to-strong rebound in overseas markets overnight, led bythe Dow's +75 points finish. The benchmark S&P 500 returned0.75%.Turnover remains weak, missing the averages badly. Total volume for the day reached only 1.703 billion as against the year-to-date average of 2.844 billion. Value flow on the otherhand, slowed to php3.807 billion, nearly 15% below the average.Both averages are net of block sale values which to dateaccounts for 5.57% and 14.93% of the totals, respectively. Asia Pacific markets were mixed with recession hit Japan in thegreen. China, which continues to battle inflation with aggressivemonetary tightening, have both mainland and Hong Kong stockstrading lower. The MSCI Apex 50 index fell -1.01%.Movements in the domestic market's sectors were thin andmixed as well. The broad All Shares Index, a representativemeasure of all listed issues, was practically flat, edging lower bya mere 0.07%. Industrial and Property counters posted marginalgains.Gainers edged decliners for the first time this week, 66 to 60. This is not sufficient to overturn the prevailing negativetrend, nor at the very least, suggest a potential reversal point.
Preliminary OUTLOOK for TD_114_June 13, 2011
The narrowing trading band and light volume and value turnover this week resulted from the uncertainties brought to the table by the prior week's poor economic numbers from the US, and an almost neutral domestic inflation number, which although better than what the market expected, remains closer to the upper limit of the government's official range. The just concluded week did not offer much appeasement for investors to aggressively increase their portfolio risks by adding equities into the mix.Such risks will persist in the coming week with the addition of anticipations of the Monetary Board's action on interest rates. The overnight borrowing and lending rates have been adjusted higher twice by a total of 50 basis points to 4.50% and 6.5%, respectively. Real rates of return are at or close to zero. Raising the rates again will create more positive space for fixed-income securities, but will be a bane for equities. Increasing the cost doing business by further tightening in a period of slower growth may dissuade the BSP from “risking” another action at this time. The meeting is slated for Thursday, yet.In the interim, markets will continue to focus on overseas developments for hints. On top of the agenda are the US economy and Europe. Major concerns are the debates on extending the US deficit ceiling or leaving the world's largest economy to a technical default. The former may roil financial markets even more. Across the Atlantic, the second aid package for Greece remains highly awaited. While there has already been an agreement in principle to tide over the
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PHILIPPINE MARKET, DAILY STATS