Bull Run?

Writing non-stop for over an hour, I suddenly hit a brick wall, my train of thought disrupted by Jacques Torres’ paella and bouillabaisse cooking in his hometown in Provence, featured on the Lifestyle Channel. I’ll resume writing tomorrow morning at 4 a.m. I hope God wakes me up at that hour, I simply ignored the alarm this morning.

The equities market has exceeded the 3,000 index. My gad, I think there’s a bull run. Volumes have been quite heavy, averaging PhP2-3 billion daily, since last year. I gained a respectable 25% on SM Investments (over a one-year period) and recently, 56% on PNOC-EDC (I bought it only last month). I wasn’t able to buy much because the International Finance Corporation bought US$50 million worth of shares, crowding out small-time retail investors like me.

I am plunking my hard-earned money on the additional share price offering of FLI this first week of February. Why FLI (Filinvest Land)? Interest rates are currently low, which means amortization rates remain attractive. In addition, OFW remittances are hitting record levels. OFWs are becoming a major market for housing projects and condominium projects. With the deployment of more professionals such as nurses, engineers and IT personnel overseas, the money remitted back usually goes into real estate, education, or cars.

I expect FLI share prices to rise significantly. The company has a good track record in developing quality housing projects. It managed to keep its head above water even during the height of the financial crisis in the late nineties.

I am also aware that foreign brokerage houses are beefing up their staff, which means foreign investors may come back again in droves, especially after the elections in May.

The peso has strengthened so much, such that government economic managers took advantage of this to pre-pay some of our sovereign debt owed to multi-lateral institutions. A credit upgrade is likely, which would translate into better confidence in the market, resulting in an inflow of portfolio funds into equities.

The peso’s strength has affected me negatively, with the kind of work I do. I have to look for other avenues to boost my income.