Stock Market Weekly: A pall of conflict remains

WHAT HAPPENED LAST WEEK

The Philippine Stock Exchange index (PSEi) fell 4.1% week-on-week (w/w) to 6,058.94 as escalating Middle East tensions drove risk-off sentiment across regional markets. Concerns over oil supply disruptions, rising energy prices, and inflation weighed on equities, with the index briefly dipping into the 6,000 level. Foreign investors were net sellers, with PHP 6.4 billion in outflows.

WHAT TO EXPECT THIS WEEK

This week, we expect the local bourse to trade sideways with a downward bias as the unresolved US-Israel war with Iran keeps global risk sentiment fragile. Tensions have escalated following reports of US strikes on Kharg Island and threats to Iran’s oil facilities, which account for about 90% of its exports. Oil prices are expected to remain elevated, with Brent and WTI

trading near USD 103 per barrel (bbl) and USD 99/bbl, respectively. Reflecting higher crude prices, the Department of Energy (DoE) projects fuel price hikes that could further stoke inflation concerns. Mid-week, investor attention will turn to the US Fed decision, which may shape rate-cut expectations and influence both Bangko Sentral ng Pilipinas (BSP) policy signals and near-term market sentiment.

Resistance: 6,350/6,300

Support: 6,050/6,150

ANALYSIS

The PSEi fell 4.14% w/w, closing at 6,058.94 (-261.47 points), and is now trading below its key moving averages (20-day, 50-day, 100-day, and 200-day). Near-term sentiment remains bearish, with the 20-day MA on track to cross beneath the 50-day MA, signaling a potential continuation of the downtrend. This weakness is further underscored by RSI and MACD indicators, both trending lower, pointing to sustained selling pressure ahead.

STOCK CALLS FOR THE WEEK

MREIT, Inc. (MREIT) | BUY ON SUPPORT | FMSEC TARGET PRICE: PHP 15.10

We view MREIT as well positioned to sustain its dividend profile following the continued expansion of its asset base. The REIT has demonstrated further growth through its Wave 4 infusion, adding 165,500 square meters of gross leasable area (GLA), with an additional Wave 5 infusion expected by 2H 2026. These infusions should support portfolio expansion while enabling its sponsor Megaworld (MEG) to recycle capital for the development of new assets that can eventually be injected into MREIT.

Accumulating on support at PHP 13.50 – PHP 13.55 is advisable. Take profits at around PHP 14.85 and set a stop loss limit at around PHP 12.82.

SM Prime Holdings, Inc. (SMPH) | BUY ON BREAKOUT | FMSEC TARGET PRICE: PHP 28.0

As highlighted in our company report entitled, “Malls deliver strong FY25 performance amidst residential softness”, the mall segment, accounting for around 60% of revenues, continues to be SMPH’s major growth driver. Sales went up by 7% year-on-year (y/y) on the back of greater Philippine mall rentals (+7% y/y) and mall-based office rentals (+16% y/y). Earnings before interest and taxes (EBIT) margin improved to 58% (previous: 53%), supported by cost efficiencies and higher occupancy.

Accumulate SMPH once it breaks above its 50-day MA at PHP 22.01 to confirm bullish momentum. Take profits at PHP 24.21 and set stop loss limits below PHP 20.91.

International Container Terminal Services, Inc. (ICT) | BUY ON SUPPORT | FMSEC TARGET PRICE: PHP 750.0

We believe the recent market reaction to escalating tensions between the United States and Iran is driving near-term volatility rather than signaling structural risk for ICT. While ICT could

face indirect pressures from potential global trade disruptions, we do not expect a material long-term impact given its diversified international portfolio and resilient cash flow profile.

Accumulating on support at the 20-day MA around PHP 680.00 is advisable. Take profits at around PHP 748.00 and set a stop loss limit at around PHP 646.00.

KEY DATA RELEASES

1) US Industrial Production y/y for February 2026 on Monday, March 16, 2026 (previous: 2.3%)

2) US Manufacturing Production y/y for February 2026 on Monday, March 16, 2026 (previous: 2.4%)

3) PH Cash Remittances for January 2026 on Tuesday, March 17, 2026 (previous: USD 3.5 billion)

4) US Producers Price Index (PPI) for February 2026 on Wednesday, March 18, 2026 (previous: 152.17 points)

5) US Fed Interest Rate Decision on Thursday, March 19, 2026 (previous: 3.75%; estimates: 3.75%)

6) PH Budget Balance for January 2026 on Thursday, March 19, 2026 (previous: PHP -313.2 billion)

7) US Initial Jobless Claims for March 2026 on Thursday, March 19, 2026 (previous: 213k; estimates: 211k)

(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.)