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PHILIPPINE STOCKS may exhibit sideways movement this week with a pessimistic tilt as the market is expected to remain wary ahead of significant economic reports both locally and in the United States.
On Friday, the Philippine Stock Exchange index (PSEi) decreased by 0.55% or 34.62 points, finishing at 6,155.57, while the broader all shares index fell by 0.43% or 16.19 points to conclude at 3,686.88.
Compared to last week, the PSEi dropped by 2.01% or 126.01 points from the 6,281.58 close on Aug. 22.
“The domestic market has now experienced a three-week decline, reflecting that bearish sentiment is currently prevailing. Confidence remains low amid a mixed set of second quarter corporate earnings, new tariff threats from the US, and uncertainties regarding the local economic outlook,” stated Philstocks Financial Inc. Research Manager Japhet Louis O. Tantiangco in a Viber message.
For this week, the market might remain in a range as investors await new catalysts, as noted by AP Securities, Inc. Research Head Alfred Benjamin R. Garcia in a Viber message.
“We anticipate that the market will continue trading largely sideways with a slight downward tendency. Investors seem likely to maintain a cautious stance while observing how the peso performs following the rate decrease,” Mr. Garcia mentioned. “Potential market influences include manufacturing and services PMI (purchasing managers’ index) data from the US and the Philippine inflation report scheduled for Friday.”
Last week, the Bangko Sentral ng Pilipinas (BSP) reduced benchmark interest rates by 25 basis points (bp) for the third consecutive meeting, bringing the policy rate to 5%, as anticipated by all 20 analysts surveyed in a BusinessWorld poll.
Since initiating its rate-cut cycle in August 2024, it has now decreased borrowing costs by a total of 150 bps.
BSP Governor Eli M. Remolona, Jr. remarked that the key rate is now positioned at the “ideal level” regarding inflation and output.
Nonetheless, he has not ruled out the possibility of one additional rate cut this year, which would likely signify the conclusion of its current monetary easing phase.
“The local market might rebound due to bargain hunting. The ruling by the US’ Court of Appeals for the Federal Circuit that many of President Donald J. Trump’s tariffs are unlawful may provide a market boost… Investors are likely to look forward to the upcoming S&P Global Philippines Manufacturing PMI and the inflation rate for August for insights into the local economy,” Mr. Tantiangco noted. He set the PSEi’s key support at 6,150 and key resistance at 6,400.
“With the local easing cycle thought to be approaching its end, attention shifts to the next broader theme, particularly as we navigate the concluding months of 2025,” online brokerage 2TradeAsia.com remarked in a market note. “The emphasis should transition from beta-driven rallies in rate-sensitive sectors to more aggressive but higher-quality narratives, at least temporarily.”
2TradeAsia.com identified the PSEi’s immediate support at 6,200 and resistance at 6,500. — Sheldeen Joy Talavera
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