End of the year review
What may practically represent the market’s condition as it closes for the year—and what it might hold for the coming year—was its trading results last week as we broke off for Christmas Day.
There were only two trading days. A spike in the market’s value turnover on Dec. 22 and the way the market closed on Dec. 23 suggested an interesting year ahead.
On Dec. 22, nonregular business transactions amounting to P7.9 billion accounted for more than half of the market’s total value turnover for the day of P13.2 billion. This was the result of the entry of strong hands, or what are called investors with long-term holding power, in eight issues. About P7.4 billion, however, were from the proceeds of the block sale of BDO Unibank Inc. (BDO) shares at P104.00 a piece.
On Dec. 23, total value turnover reverted within the market’s regular transaction range of P8.1 billion and volume of 1.3 billion shares. Noticeably interesting was how the market played out that day: It opened at 7,138.25 and closed at 7,186.32, indicating an upward trend.
In addition, the market’s opening index was also the day’s low and the closing index was the high for the day, too, indicating that market bulls (buyers) were in full control all the way till the end of trading.
Offering added insight were the trading results from the individual sectors: All sectors ended with a gain from a low of 0.24 to a high of 2.44 percent. Because there were less willing to sell, the value turnover of all sectors—except the financials which was up 324.22 percent—declined as follows: Industrials, 24.69 percent; holding firms, 73.07 percent; property, 28.03 percent; services, 30.64; mining & oil, 49.05, and All Shares index, 14.97 percent.
Market capitalization went up by another 1.2 percent to P2 billion distributed as follows: 29.0 percent for the financials with 31 companies; 18.5 percent for the industrials with 67 companies; 22 percent for the holding firms with 41 companies; 11.4 percent for the property with 38 companies; 16 percent for the services with 56 companies, and 3.1 percent for the mining & oil with 25 companies.
Foreign transactions, in the meantime, went down to 45.66 percent, pulling down once more year-to-date foreign investors’ participation to an average of 49.14 percent. This is a big contrast from their position at the start of the year, which was at an average of 58.51 percent.
IPOs
Compared to previous years, it seems that we have the most number of public equity offerings and listings this year. Technically, two of which were offered and listed by way of introduction or LBI—the process of simply trading the shares of a company upon the approval of its listing application.
These companies were Top Frontier Investment Holdings Inc. (TFHI) and Trans-Asia Petroleum Corp. (Tapet). TFHI was listed on Jan. 13, while Tapet was listed on Aug. 28.
Their offer or valuation price was P178 and P4.60 a piece, respectively. Based on their last traded price as of last Dec. 23 of P123.70 and P4.15, TFHI shares are down 30.51 percent and Tapet shares are down 9.78 percent.
The rest that went through the usual initial public offering or IPO route seem to be more fortunate. They are as follow: Double Dragon Properties Corp. (DD), listed on April 7; Century Pacific Food, Inc. (CNPF), listed on May 6; SSI Group, Inc (SSI), listed on Nov. 7; Phoenix Semiconductor Philippines Corp. (PSPC), listed on Dec. 1, and Xurpas Inc. (X), listed on Dec. 2.
At the offer price of P2 per share, DD has realized a rate of return of 268 percent at its price of P7.37 on Dec. 23.
Also, despite the fact it was listed on the small and medium enterprise board only, its regular trading volume for the year had overshadowed most of the average transactions of most large cap issues listed at the main board.
First to be listed on the main board during the year and trading as well at relatively high trading volume, CNPF shares have chalked up a rate of return of 12.27 percent based on the offer price of P14.50 and last traded price of P16.28 a share on Dec. 23.
PSPC was not fortunate. Upon listing, the investing public immediately unloaded. They appeared uncomfortable with the offering terms, where the larger part of the public issue was secondary—which simply means the original owners were selling out.
As a result, PSPC share prices are now down 22.87 percent from their offer price of P3.76 as compared their latest traded price of P2.90 per share on Dec. 23.
SSI and X did better upon listing. As of their last traded price of Dec. 23, they are now up 32 percent and 145.34 percent, respectively.
Bottom line spin
Based on the survey results published by the Social Weather Stations (SWS) over the weekend, 93 percent or 9 out of 10 of the populace is reportedly hopeful instead of fearful of their prospects for 2015. The survey covered the period Nov. 27 to Dec. 1.
Another pollster, Pulse Asia, appears to have similar findings based on a survey it conducted on Nov. 14 to 20. The study showed that 88 percent of Filipinos were “facing 2015 with hope.”
Based on previous studies made by the SWS, “New Year hope” reached an all-time high of 95 percent in 2002. This declined to 85.5 percent the following year and to 81 percent in 2004.
Such “New Year hope” rose to 85 percent in 2005. It ranged from 91 to 92 percent from 2006 to 2008. This declined to 89 percent in 2009 and bounced back to 93 percent in 2010.
In 2011, the said “New Year hope” jumped back to the all-time high of 95 percent and slid to 92 percent in 2012.
A little disconcerting, “New Year hope” for 2015 is only 93 percent, which is actually a point lower than that of 2014. Of consolation, said “New Year hope” is consistently shared in all areas surveyed—“91 percent in Metro Manila, Visayas and Mindanao and 96 percent in Balance Luzon,” which is practically equivalent to the record-high of 97 percent entered in 2014.
In conclusion, the market is set to go upward by the end of the year. Matched with a hopeful mindset, the stage for another interesting trading year is at hand. Best wishes and Happy New Year!
(The writer is a licensed stockbroker of Eagle Equities Inc. You may reach the Market Rider at [email protected], [email protected] or at www.kapitaltek.com)
