It was yet again another strong week for Philippine stocks market. The benchmark index rose 30.56 points to 5,794.20, slightly below the 5,800 mark. Recent favorable economic data continue to propel local bourse into new heights despite high market valuations. IT was reported last week that the Philippine economy posted a surprising 7.1% growth in GDP.
A Questionable Run?
PSEi continue to reach new highs, but the number of declining stocks mostly outnumber or equal the number of rising stocks. Below table is the stocks movement from November.
Notice that when PSEi declines, stocks advancers always outnumbered the decliners, except on November 14. But when PSEi is up, the overall market does not necessarily follow the trend. Out of 18 times the benchmark index has moved up, there were only 10 times that the advancers outnumbered the decliners.
What this means is the overall market is not really having a bullish run. Some stocks, notably blue chip companies, just outperform other stocks. In can also be a rotational play on traders where a stock that previous fell would catch the attention as being "cheap" and would therefore rise the following day.
Last week, I encouraged everyone to take action and start investing. But we also have to be mindful of what we invest in. Even though the stocks market reaches new high almost everyday, it does not mean you can buy any stock there is and expect a profit. That's not how it works. You still have to put on the hard work and do researches in order to achieve your desired results. If you are already investing, it may even be not a bad idea to start asking yourself, "When can I sell and take my profits?"
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