The Philippine Stock Exchange index (PSEi) dropped 3.40% week-on-week (w/w) to close at 5,855.91 (-205.90 points), weighed down by heightened Middle East tensions as the US and Iran continued their mutually destructive war.
Sentiment stayed cautious throughout the week, with foreign investors net selling PHP3.7 billion as they trimmed exposure to the Philippines. The US Fed’s 25-basis-point hike tightened the rate differential with that of the Bangko Sentral ng Pilipinas (BSP) to 1.25%. The peso also extended its slide against the US dollar, closing the week at PHP 62.785. On the commodities front, oil prices resumed their climb, with Brent at USD 103.21/barrel and WTI at USD 99.53/bbl.
We expect the local bourse to trade sideways with a downward bias. Tensions in the Middle East are expected to remain elevated, while pump prices are also set to increase, with diesel and gasoline prices projected to rise on Tuesday by PHP 11/liter and PHP 5/L, respectively, adding fresh inflationary pressure.
With the Fed having announced a 25-bp rate hike, the peso could remain weak. Elevated bond yields are also likely to remain a headwind, with the Philippine 10-year government bond yield approaching 8%, keeping investors on the sidelines and further pressuring valuations.
Resistance: 6,100/6,200
Support: 5,700/5,800
The PSEi fell 3.4%, or 205.90 points w/w, to close at 5,855.91. The index fell sharply last week and is now approaching another multi-month low. Meanwhile, the RSI is nearing oversold territory, which may signal a near-term rebound, although the MACD remains negative, indicating bearish momentum is still intact.
Accumulating stocks as the index breaks above resistance around the 100-day and 200-day MA is recommended to confirm a bullish reversal.
Puregold Price Club, Inc. (PGOLD) | BUY ON BREAKOUT | FMSEC TARGET PRICE: PHP 60.00
Puregold Price Club, Inc.’s (PGOLD) 1H 2026 net income rose by 10.8% year-on-year (y/y) to PHP 5.87 billion, in line with consensus and our estimates. Revenues rose 10.6% y/y to PHP 121.5 billion, driven by 6.7% consolidated same-store sales growth (SSSG).
Meanwhile, management reiterated its FY2026 topline growth guidance of 5%-7% and gross margin targets of 15.5%-16.5% for Puregold stores and 21.5%- 22.5% for S&R Warehouse Clubs.
Accumulate PGOLD once it breaks above its resistance at PHP 41.34. Take profits at PHP 45.47 and set stop-loss limits below PHP 39.27.
Ayala Land, Inc. (ALI) | BUY ON BREAKOUT | FMSEC TARGET PRICE: PHP 17.50
Ayala Land Inc. (ALI) was migrated from the MSCI Philippines Standard index to the MSCI Philippines Small Cap index with a 9.70% weight. Amid this, we believe investors will not shift their focus from ALI’s fundamentals, backed by the company’s high-quality assets and improving earnings trajectory. ALI’s 1H26 results showed early signs of stabilization, supported by solid growth in its leasing business, which grew 9% y/y.
Accumulate ALI once it breaks above PHP 15.74 to confirm a break from consolidation. Take profits at PHP 17.31 and set stop-loss limits below PHP 14.95.
D&L Industries, Inc. (DNL) | BUY ON PULLBACK | CONSENSUS TARGET PRICE: PHP 3.85
D&L Industries, Inc.’s (DNL) 1H 2026 net income grew 8% y/y to PHP 1.5 billion, ahead of consensus estimates. Revenues increased 1% y/y to PHP 26.77 billion, driven by improvements in the higher-margin specialty segment (HMSP), while domestic revenues increased 8% y/y to PHP 20.7 billion.
Accumulating once it pulls back around PHP 3.50 is advisable. Take profits around PHP 3.85 and set a stop loss around PHP 3.33.
