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Stock Market Weekly: Fragile global risk sentiment
Inflation fears, globally and locally, are up as the US and Israel intensify military action against Iran.
By First Metro Securities Research
WHAT HAPPENED LAST WEEK
The Philippine Stock Exchange index (PSEi) plunged 4.40% week-on-week (WoW) to 6,320.41 (-290.83 points). The local bourse traded sharply lower for most of the week as risk sentiment deteriorated following escalating geopolitical tensions in the Middle East, which triggered broad sell-offs across regional markets.
The index briefly slipped into the 6,300 range amid heightened concerns over potential oil supply disruptions and the implications of higher energy prices on global inflation and interest rate expectations. Meanwhile, February inflation came in at 2.4%, remaining within the Bangko Sentral ng Pilipinas’ (BSP) target range and providing some support to the medium-term policy outlook. Bargain hunting provided intermittent support, allowing the market to stage modest intraday recoveries after steep declines, although overall sentiment remained cautious as investors continued to assess the potential economic impact of the conflict and monitor movements in global markets.
WHAT TO EXPECT THIS WEEK
This week, we expect the local bourse to trade sideways with a downward bias as the conflict between the US and Iran remains unresolved, keeping global risk sentiment fragile. On the commodities front, market participants expect oil prices to remain elevated, with Brent Crude and West Texas Intermediate (WTI) trading at USD 92.86/barrel and USD 91.26/barrel, respectively.
Reflecting these developments, the Department of Energy has projected minimum increases of PHP 19/liter for diesel, PHP 9/liter for gasoline, and PHP 31/liter for kerosene, which may further fuel inflation concerns. Towards the middle of the week, investor focus will shift to the release of US inflation data (estimates: 2.5%), which could shape expectations on the policy trajectory of the US Federal Reserve and whether rate cuts remain on the table. The outcome will also provide signals for the policy path of the BSP, potentially influencing near-term market sentiment.
Resistance: 6,550/6,500
Support: 6,250/6,200
ANALYSIS
The PSEi plunged by 4.40% WoW to 6,320.41 (-290.83 points), below the 20-day and 50-day moving averages, while the MACD has also crossed below the signal line indicating bearish momentum. Meanwhile, the RSI is currently in oversold territory, which may indicate a potential rebound. Price action will continue to have short-term volatility amid Middle East crises.
STOCK CALLS FOR THE WEEK
China Banking Corp. (CBC) | BUY ON SUPPORT | CONSENSUS TARGET PRICE: PHP 105.00
We see CBC gradually positioning itself as a credible challenger to the Philippines’ big 3 banks. The bank continues to demonstrate steady growth, with full-year 2025 net income rising 13% year-on-year (YoY) while operating expenses increased at a slightly slower pace of 12% YoY, reflecting disciplined cost management alongside expansion.
CBC has also maintained stable net interest margins (NIMs) despite rate cuts in 2025, supported by strong deposit mobilization, with current account-savings account (CASA) growing 17% YoY, outperforming several peers. Accumulating on support at the 20-day moving average (MA) around PHP 68.50 is advisable. Take profits at around PHP 75.35 and set a stop loss at around PHP 65.00.
Megaworld Corp. (MEG) | BUY ON SUPPORT | FMSEC TARGET PRICE: PHP 2.80
Megaworld Corporation (MEG) is expanding its Meetings, Incentives, Conferences, and Exhibitions (MICE) segment, creating additional avenues for long-term growth across its township, hospitality, and commercial ecosystems. The expansion also positions MEG to maximize the recently updated REIT framework, which allows a broader range of cash-generating assets beyond traditional office and residential properties.
Accumulating on support at the 20-day MA around PHP 2.16–2.17 is advisable. Take profits at around PHP 2.48 and set a stop loss limit at around PHP 1.94.
Bank of the Philippine Islands (BPI) | BUY ON BREAKOUT | FMSEC TARGET PRICE: PHP 143.00
As mentioned in our company report entitled, “Rising risks and returns”, BPI registered record performance amid rate cuts, underpinned by above-industry loans growth at 14.7% and strong pre-provision operating profit (PPOP), up by 19.5%, which led to a robust return on equity (ROE). The higher opex stemmed from business expansion, with increased spending on manpower, technology, and volume-related costs.
Accumulate BPI once it breaks above its 100-day MA at PHP 113.72 to confirm the downtrend reversal. Take profits at PHP 125.09 and set stop loss limits below PHP 108.03.
KEY DATA RELEASES
- US Inflation Rate YoY for February 2026 on Wednesday, March 11, 2026 (previous: 2.4%; estimates: 2.5%)
- US Core Inflation Rate YoY for February 2026 on Wednesday, March 11, 2026 (previous: 2.5%; estimates: 2.5%)
- US Balance of Trade for January 2026 on Thursday, March 12, 2026 (previous: -USD 70.3 billion; estimates: -USD 69 billion)
- US Imports for January 2026 on Thursday, March 12, 2026 (previous: USD 357.6 billion)
- US Exports for January 2026 on Thursday, March 12, 2026 (previous: USD 287.3 billion)
- US Initial Jobless Claims as of March 7, 2026, on Thursday, March 12, 2026 (previous: 213k; estimates: 215k)
- PH Unemployment Rate for January 2026 on Friday, March 13, 2026 (previous: 4.4%)
(First Metro Securities Disclaimer: We obtain our information from sources we believe are accurate and reliable, but we cannot guarantee its completeness or accuracy. Our content consists of opinions, not investment recommendations, and you should perform your own research before making any investment decisions. First Metro Securities is not liable for any losses or damages resulting from the use of this information.)
(Metrobank Disclaimer: This is general investment information only and does not constitute an offer or guarantee, with all investment decisions made at your own risk. The bank takes no responsibility for any potential losses.)