The PSE index
The PSEi closed in the negative territory on Friday, shedding 10.66 points to close at 4,346.07. While the Dow Jones Industrial Average, DJIA, closed at a very disappointing 10,992.13, sliding 303.68 points. We can see the immediate resistance of the index at 4,380, then at the psychological resistance at 4,400. It has been consolidating for the past few weeks.
Hopefully, we can ignore the negative sentiment of the Dow because of the anticipated events for tomorrow, Monday, Sept. 12, namely, the new PSE index composition and the debut of PXP (Philex Petroleum Corp) via LBI (Listing By way of Introduction).
LBI is an alternative way for a company to be listed publicly without making an initial public offering (IPO). The other alternative way of getting a company public is via backdoor listing like what Century Properties did. I guess more and more privately-held companies in the Philippines will prefer these alternatives than getting their companies public via IPO to avoid the long and complex IPO process and the expense that goes to the underwriters from investment banks. What’s the goal of a company going public anyway? To raise cash to fund for future expansions or to pay the investment banks? 
Stocks to be Included in the PSE Index
From my previous post: The 5 Companies which will be added on the index are BEL, CEB, SMC, SCC and SMDC. In my “chart” point of view, the companies that will likely move up this week are BEL, CEB and SMC. All of them are now trading above their 20D Moving average.
BEL (Belle Corp) – Philippine developer of high-end residential and leisure properties, my target price (TP) – P4.75
CEB (Cebu Air) – the country’s biggest budget carrier, offering flights around Asia. My TP at P86-90
SMC (San Miguel Corp) – the Philippines’ biggest listed company, the food and beverage company that’s expanding into oil refining, power retailing and infrastructure. My TP at P132- long term at P152
Image from 123RF.com
