The Bank of England (BOE)\u2019s bond-buying program triggered a domino effect in both bond and equity markets. It brought down 10-year Gilt yield to 4.01% after touching almost 4.6% this week which then drove US yields lower to 3.7% from its Tuesday close of nearly 4%.<\/p>\n\n\n\n
Given the negative correlation between bonds and equity, the decline in yields subsequently led to the rally in US stock market \u2014 although we note that the market was already in oversold territory back then which could have also helped trigger the bounce. Amid the whole process, USD has notably lost its steam with DXY (US dollar index) declining sharply to 113-level after reaching nearly reaching 114.80.<\/p>\n\n\n\n
At home, Peso has appreciated against the dollar, now below 59-level. Given the slight recovery of Peso and positive US market sentiment, we expect PSEi to bounce off from yesterday\u2019s close.<\/p>\n\n\n\n
For investors who would be taking advantage of this relief rally, bottom fishing should be ideal \u2014 we lay down below our updated 52-week high and low table for reference. Funda-wise, among the top 10 stocks that have declined the most from 52-week high, we remain partial to CNVRG (Target Price: P35.00), SECB (Target Price: P140.00), and PGOLD (Target Price: P52.00); although GLO (Target Price: P3,040) and GTCAP (Target Price: P640.00) have attractive upsides, there could be an overhang from the impact of weaker Peso on their financials ($ denominated debt for GLO and margins for GTCAP).<\/p>\n\n\n\n
However, given that BOE\u2019s move only acts as a band-aid solution to current macro conditions and does not address the underlying negatives (inflation and interest rate concerns), we would advise on topslicing as the index approaches resistance level. Chart-wise, PSEi\u2019s support and resistance stands at 5,700 and 6,200, respectively.<\/p>\n","protected":false},"excerpt":{"rendered":"
Here’s a commentary on an important issue or event affecting the stock market <\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[],"class_list":["post-317650","post","type-post","status-publish","format-standard","hentry","category-special-reports","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317650","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/comments?post=317650"}],"version-history":[{"count":2,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317650\/revisions"}],"predecessor-version":[{"id":320531,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/posts\/317650\/revisions\/320531"}],"wp:attachment":[{"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/media?parent=317650"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/categories?post=317650"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/wp-json\/wp\/v2\/tags?post=317650"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}