New program, April Fools’ Day, Holy Week

THERE are three subject matters that people at the bourse are most likely talking about this week. These are the new computerized trading program, April Fools’ Day and the Holy Week.

Like elsewhere, April Fools’ Day is traditionally consigned as a day of clean fun—a light-hearted type of merry-making among people in the bourse. This includes “sending someone on a ‘fool’s errand,’ looking for things that don’t exist, playing pranks and trying to get people to believe ridiculous things.”

Known too as All Fool’s Day, it also marks the exit of the dangerous month of March and signals the entry of the foolhardy month of April.

March results

The market did well in March, having, more or less, ended last week. But true to its treacherous reputation, the trading ride in March was not exactly smooth.

Just only a week into the month, the market was soon thrown into a series of lower lows. From its closing high of 7,861.33 points on March 6, the market winded downwards. On March 16, the market found itself at 7,730.95. By that time, it was driven down deep with a loss of 130.38 points or 1.69 percent. At that time, too, the market was practically transported back to where it started for the month at 7,730.57.

Coincidentally, March 16 was within the feared two-day period of the ides of March as portrayed by William Shakespeare in a play of the same title as he associated the date to evil and harm like the gruesome assassination of Julius Caesar in 44 BC.

Despite the deep fall, that could have very well resulted into a possible reversal, the market recovered remarkably. It ended the month with a total gain of 147.39 points or 1.9 percent. This was a big surprise in comparison to the market’s performance in February. After all the series of record highs established then, the market only ended with a measly monthly gain of 40.66 points or 0.53 percent.

At last Friday’s close of 7,877.96, the market established a new record high, again. This also made the market to have climbed 647.39 points or 8.95 percent since the beginning of the year.

It may be worth to infer that due to the marked increase in foreign investors’ participation to 53.36 percent of total market transactions, this could have aided the market’s favorable performance in March. In February, when the market barely moved up, foreign investors’ participation was only 45.53 percent.

This week

Trading activity will most likely be dull and slow because of the observance of Holy Week. Most market participants will surely take an early vacation. The trading floor will be almost empty this week.

As everyone will be out on vacation, trading volume and value turnover are expected to be low and small. However, the absence of volume will not necessarily translate to a drop in market prices like they almost always did in the past on the same period.

A change in the movement and direction of market prices will only happen when the balance of prevailing market fundamentals is disturbed. According to news reports, it looks like current market fundamentals will stay unchanged, at least, until after the Holy Week.

There is no assurance, though, that current market fundamentals will not change just soon. They are considerably tenuous and volatile. They could easily turn bad or good at the slightest change in their balance, so to speak.

For instance, the fragile ceasefire agreement between Ukraine and its Russian-backed rebels could break anytime to a larger scale that might draw the super powers into a proxy fight in the same way that Saudi Arabia and Iran are starting to be pitted against each other in Yemen, the latest powder keg in Southwest Asia, occupying the southwestern and southern end of the Arabian peninsula.

Because of their divergent religious orientations, Saudi Arabia and Iran in their involvement in Yemen could possibly transform into another kind of religious-related attrition that may worsen the religious bloodbath and balance of power in the Middle East.

The territorial conflict on islands lining the shores of countries like the Philippines, Vietnam and Japan in Southeast Asia is another potentially dangerous arena involving violent repercussions. They could easily escalate into confrontations. When dragged to a long-drawn conflict, it could degrade the economic advances of the involved countries and the region.

In the same way that the above cited geopolitical-religious concerns could affect the whole world, the Greek debt situation could as well turn into a financial problem like a small stone chip in the shoes of the European Union and the world, too.

Bottom line spin

What could be a challenge to many trading personnel was the migration by the exchange into another computerized trading program. Training for the new system has been going on for quite some time.

For the older traders, who were just about to get their feel of the last computer trading program instituted not long ago, the proposition to study another computer trading program was daunting and a definite bother.

As it initially appeared, studying the manual was already cumbersome. Committing the new commands to memory was even more cumbersome. And, forgetting the old commands could be confusing. As it turned out, however, the new system in the actual practice last Saturday turned out to be not that bad and difficult to handle.

The program is user-friendly. It has features that could capture many trading preferences and requirements of experienced traders. It can also easily pop up as many market data within easy commands.

Contrary to the worries by the old timers, therefore, the new trading program of the bourse turned to be a pleasant surprise.

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