By means of Revin Mikhael D. Ochave, Reporter
The Philippine Stock Exchange index (PSEi) could trade at 7,000-8,000 this year with the start of US President Donald J. Trump’s second term, the direction of global monetary policy and the Philippines’ midterm elections that will dictate the direction of the market. movement.
The PSEi ended 2024 at 6,528.79, up 1.2% or 78.75 points from the final score of 6,450.04 at the end of 2023. This was the first time since 2019 that the index showed a year-on-year increase .
The local stock barometer could peak as low as 7,600 this year, amid market caution as Mr. Trump begins his second term as U.S. president China Bank Capital Corp. director Juan Paolo E. Colet takes a Viber -message.
“[This] years paints a complicated picture. While we remain positive on the growth prospects of the Philippine economy and the earnings power of many listed companies, we approach 2025 with caution as there is a lot of uncertainty surrounding Trump 2.0. As in his first term, we expect Trump’s social media posts to move markets again, so investors should be ready to manage that volatility,” Colet said.
The upcoming Philippine midterm elections and geopolitical issues could create additional uncertainties, he added.
“We are wary of the impact of potential natural disasters and geopolitical tensions on our country’s economy. Investors will also be closely watching the midterm elections, as their outcome could provide stability or create uncertainty.”
BDO Capital & Investment Corp. President Eduardo V. Francisco said in an interview that the market could trade between 7,000 and 7,500 this year.
“Even if the US announces a rate cut, that is not necessarily a good thing. And if the peso depreciates, the foreign investors will be hurt because the hot money wants the peso to be strong and stable,” he said.
AP Securities, Inc. Research Chief Alfred Benjamin R. Garcia was “cautiously optimistic” about Philippine stocks this year, citing the market’s potential despite headwinds.
“We believe the fundamentals are there to lift the market, but we recognize that we face numerous headwinds, including more superficial rate cuts and the likelihood of another global trade war,” he said in a Viber message.
“Despite concerns about both international and local factors – such as macroeconomics, geopolitical situations and the new President of the United States – PSEi’s numbers and valuations provide a positive outlook,” said Luna Securities, Inc. Research Officer and market strategist Annika Gabrielle S. Angeles says this in a market report.
Ms Angeles said that according to their base case, the PSEi could trade between 7,030 and 8,080 this year.
COL Financial Group, Inc. Chief Equity Strategist April Lynn C. Lee-Tan said market drivers for 2025 include lower inflation and interest rates, as well as the midterm elections.
She added that the market’s “attractive valuations” and the recently signed Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy Act could provide an investment boost.
However, Ms Tan said US market volatility is a potential risk as it could spill over to the Philippines.
“The Philippines is suffering from contagion when it comes to the volatile US market,” she said.
“Any improvement in local and external market conditions, especially if the PSEi moves to levels of 7,000-8,000, would help encourage more fundraising activities in local equity markets, such as IPOs, follow-on offerings, preference share offerings, equity offerings. , including private placements,” Michael L. Ricafort, chief economist of Rizal Commercial Banking Corp., said in a Viber message.