Stock Market Weekly: Potential bargain hunting 

WHAT HAPPENED LAST WEEK

The local bourse ended another shortened trading week in the red, sliding by 2.01% to close at 6,155.57 (-126.01 points). The market started the week in a spiritless mood, as sentiment was dragged by the Konektadong Pinoy Act which lapsed into law last Sunday. The law is expected to intensify competition in the telco sector.

The weakness was exacerbated by significant fund outflows due to the implementation of the MSCI quarterly index rebalancing (effective August 27, 2025).

Meanwhile, the policy rate cut of 25 basis points (bps) by the Bangko Sentral ng Pilipinas (BSP) was unable to improve sentiment, as the peso depreciated back to the PHP 57.0 level due to a tighter US-PH interest rate differential of 50 bps.

On the foreign front, US policy direction was further clouded by a stronger revised 2Q 2025 US GDP at 3.3% (from 3.1%) and an elevated PCE Price Index at 2.6% (estimates: 2.6%) for July.

WHAT TO EXPECT THIS WEEK

This week, we expect the market to remain range-bound, with a slight upward bias on potential bargain hunting.

Amid the lack of local catalysts, investors will turn their attention overseas, tracking key data releases such as the US ISM manufacturing PMI and JOLTS job openings, which may provide more clarity on the direction of the US policy rate.

On Friday, the market will digest the local inflation rate for August 2025, with investors expecting a slight uptick from a month ago to 1.1% year-on-year (y/y) (July: 0.9%).

Resistance: 6,300/6,200

Support: 6,100/6,000

ANALYSIS

The Philippine Stock Exchange index (PSEi) slipped 2.01% week-on-week (w/w) to 6,155.57 (-126.01 points), remaining below all key moving averages (20-day, 50-day, 100-day, and 200-day).

The index broke below the 6,200 support early in the week on heavy selling pressure.

With the PSEi now under this level, a rebound may occur on value buying, but persistent weakness could pull the benchmark closer to the 6,100 support zone.

STOCK CALLS FOR THE WEEK

Globe Telecom, Inc. (GLO) | LIGHTEN POSITIONS | FMSEC TARGET PRICE: PHP 1,830.00

GLO has been in a downtrend over the past few months due to regulatory overhang and weak financial performance, trading below all key moving averages (MAs) (20-day, 50-day, 100-day, and 200-day).

While momentum indicators are in oversold territory, the stock continues to fall to new 52-week lows, signaling persistent bearish sentiment.

As such, we recommend reducing exposure until regulatory risks become clearer. For those with exposure, lighten positions to manage risk from regulatory headwinds.

AREIT, Inc. (AREIT) | BUY ON PULLBACKS | FMSEC TARGET PRICE: PHP 43.70

AREIT’s near-term trajectory has been sharply bullish, trading near 52-week highs and well above key technical levels. The stock has also broken past all major moving averages.

That said, the recent surge looks overextended, leaving room for a healthy pullback toward the support area around PHP 42.00. For investors looking to accumulate, we recommend entering on pullbacks around PHP 42.

Holding through next year could deliver ~10% total return from dividends and price appreciation if the stock reaches our fundamental target of PHP 43.70. To manage risk, set stop-loss limits below PHP 40.00.

D&L Industries, Inc. (DNL) | BUY ON BREAKOUT | CONSENSUS TARGET PRICE: PHP 7.18

The counter has been on a steady downtrend, even falling to its 52-week low of around PHP 4.70 following its removal from the MSCI Small Cap Index.

Throughout this period, the stock has remained below all key moving averages (MA), with the 20-day MA serving as immediate support. Momentum indicators also point to continued weakness, with the RSI hovering in oversold territory and the MACD showing tepid signals.

A sustained breakout above the 20-day MA, however, could signal a potential turnaround in the stock’s momentum. Accumulating once DNL breaks above PHP 4.95 is advisable. Take profits at PHP 5.70 and set stop-loss limits below PHP 4.55.

KEY DATA RELEASES

1. S&P Global Manufacturing Purchasing Mangers’ Index (PMI) for August 2025 on September 1, 2025 (estimates: 1.1%; previous: 0.9%).

2. US ISM Manufacturing PMI for August 2025 on September 2, 2025 (estimates: 48.6%; previous: 48.0).

3. US JOLTs Job Openings for July 2025 on September 3, 2025 (estimates: 7.5 million; previous: 7.4 million).

4. PH Inflation rate y/y for August on September 5, 2025 (estimates: 1.1%; previous: 0.9%).

(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.)