THE PHILIPPINES Stock Exchange index (PSEi) ended the week at 7,800 points again, causing concern among investors and stock brokers. According to local stock broker and technical analyst, Hernan Segovia, out of the 30 stocks in the PSEi, only six of them are keeping the whole index from further falling.
“The market is still locked in the 7,800 range, because there are only around six companies keeping it at said level,” Segovia said. “Actually, we have an acronym for them – JABASS. It’s JG Summit, Ayala Corporation, BDO, Ayala Land, SM Investment Group and SM Prime Holdings.”
Without the six companies, Segovia speculates that the PSEi will be around the 6,000 level, because most other companies are being sold off by large funds, which is putting downward pressure on the PSEi.
“We’ve seen the number 7,800, but the feeling is opposite,” Segovia said. “The foreign and big funds are staying in those six stocks.”
Despite the prevailing market, he still holds out hope that things will turn around before the end of the year or at least by early 2020, but for now, the market is reliant on the JABASS companies.
Segovia said the six stocks are still going strong, though he doesn’t discount the possibility that they could weaken in the future.
“We could easily see signs of weakness on those six stocks, but so far none,” Segovia explained and advised people to avoid entering the market in the near future in case things get worse in the weeks to come./PN
