Stock Market Weekly: Bargain hunting may continue 

WHAT HAPPENED LAST WEEK

Last week, the Philippine Stock Exchange index (PSEi) rose 1.36% to close at 6,108.86 (+81.70 points). The index opened the week in the red, dipping under the 6,000 mark after several research houses lowered their economic projections for the Philippines due to the impact of recent inclement weather, the 6.9 magnitude earthquake in Cebu, as well as lost productivity owing to alleged misuse of government funds.

Additionally, investors remained on the sidelines for telco names as they awaited the implementing rules and regulations of the Konektadong Pinoy Act. The market recovered sharply mid-week amid a steep drop in oil prices and the appreciation of the peso back to the 57 level in anticipation of a US Fed cut later this month.

Meanwhile, expectations for Philippine inflation remained subdued at 1.9% for September 2025.

WHAT TO EXPECT THIS WEEK

We expect volatility to pick up this week with a slight upward bias amid a slew of local and foreign catalysts. The market will digest key data releases such as the Philippine inflation rate and unemployment rate, which could influence the Bangko Sentral ng Pilipinas’ (BSP) interest rate decision on Thursday.

On the foreign front, the market will primarily take cues from several US Fed speeches, especially amid the ongoing government shutdown. Fed Chair Jerome Powell is set to provide input on the direction of the US economy.

Further signals on continued policy easing measures may bolster sentiment and encourage bargain hunting.

Resistance: 6,200/6,300

Support: 6,000/5,900

ANALYSIS

The PSEi increased by 1.36% week-on-week (w/w) to 6,108.86 (+81.70 points). This reflects the positive momentum midweek after dipping below the 6,000 threshold.

The index is now poised to break above its 20-day moving average (MA), supported by improving sentiment. The MACD has recently crossed above the signal line, while the RSI is trending upward after rebounding from oversold territory—both indicators suggesting the potential for sustained bullish momentum.

STOCK CALLS FOR THE WEEK

MREIT, Inc. (MREIT) | BUY | FMSEC TARGET PRICE: PHP 14.96

MREIT is nearing its immediate support at PHP 13.40 after a 6.72% w/w decline, largely driven by its recent block sale which was priced at a discount. While the stock has dipped below key moving averages (20-day, 50-day), technical indicators show potential for a rebound, with the RSI in deeply oversold territory.

We believe the stock may be poised for recovery once selling pressure eases.

Accumulating MREIT at current levels around PHP 13.60–13.40 is advisable. Take profits at PHP 14.96 and set a stop-loss limit at PHP 12.92.

Ayala Corp. (AC) | BUY | FMSEC TARGET PRICE: PHP 540.00

AC broke below its long-term channel, registering its lowest price since the pandemic crash at PHP 476. It is trading below key moving averages (200-day, 100-day, and 50-day), with momentum indicators RSI and MACD at oversold levels.

While demand remains benign, AC is hovering at long-term support levels, which we see as favorable entry points, especially for long-term holders.

Accumulate AC should price reach PHP 470.00. Take profits at PHP 540.00 and set stop loss limits below PHP 430.00.

Converge ICT Solutions, Inc. (CNVRG) | BUY ON BREAKOUT | CONSENSUS TARGET PRICE: PHP 14.45

CNVRG is now trading below key long-term moving averages (50-day, 100-day, and 200-day) after breaking below its channel, declining by nearly 50% from its 52-week high of PHP 21.70. It is currently forming a continuation pennant, signaling a potential retest of its recent low.

However, a break above this may signal a recovery. Thus, we advise accumulating once CNVRG breaks above the pattern.

Accumulate CNVRG once it breaks from its pennant pattern at PHP12.50. Take profits at PHP 14.45 and set stop loss limits below PHP 11.50.

KEY DATA RELEASES

1. PH Inflation Rate year-on-year (y/y) for September on Tuesday, October 7, 2025 (estimates: 1.9%; previous: 1.5%)

2. PH Unemployment Rate for August on Wednesday, October 8, 2025 (estimates: 4.8%; previous: 5.3%)

3. PH Interest Rate Decision on Thursday, October 9, 2025 (estimates: 4.75%; previous: 5.00%)

4. US FOMC Minutes on Thursday, October 9, 2025

5. US Initial Jobless Claims as of October 4, 2025, on Thursday, October 9, 2025 (estimates: 235k)

(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.)