Philippine shares may drop on selling pressure

PHILIPPINE SHARES may decline in the coming days as the market may succumb to selling pressure following last week’s rally and as cautiousness could prevail as investors await fresh leads.

On Friday, the Philippine Stock Exchange index (PSEi) rose by 0.43% or 27.47 points to end at 6,348.14. This was a new five-month high for the main index as this was its best close since Aug. 7’s 6,364.69.

Meanwhile, the all shares index edged down by 0.01% or 0.65 point to close at 3,607.

Week on week, the PSEi climbed by 213.08 points from its Jan. 2 finish of 6,135.06.

“The local market has been exhibiting a bullish bias recently, rallying for three straight weeks and breaking above crucial lines including the 200-day exponential moving average which it last traded above in July 15. Foreign investors have also been supportive recently, with the past week registering a net inflow of P2.16 billion,” Philstocks Financial, Inc. Research Manager Japhet Louis O. Tantiangco said in a Viber message.

2TradeAsia.com said in a market note that the PSE index soared above the 6,300 mark last week on benign inflation and strong manufacturing activity data that bolstered the case for another rate cut by the Bangko Sentral ng Pilipinas (BSP) in February.

These overshadowed the peso’s plunge to a new record low of P59.355 on Wednesday, it added.

Philippine headline inflation picked up to 1.8% in December from 1.5% in November. For 2025, the consumer price index averaged 1.7%, below the BSP’s 2%-4% target but a tad higher than its full-year forecast of 1.6%.

Meanwhile, S&P Global said the Philippines Manufacturing Purchasing Managers’ Index rebounded to 50.2 in December from a 47.4 reading in November.

For this week, Mr. Tantiangco said profit taking could pull the PSEi down again.

“With a three-week run, we may see strong selling pressures this week driven by profit taking. Investors may also move with more cautiousness while waiting for new catalysts. These include: updates on the situation between the US and Venezuela; clues on the BSP’s policy path this 2026; movement of the peso; and clues on the local economy’s growth trajectory,” he said. “Investors may also take cues from our upcoming foreign direct investments and overseas Filipino workers cash remittances data.”

“The bourse is nearing its resistance at 6,400. If it is able to take this level, then it may target its next resistance at 6,600.”

2TradeAsia.com placed the PSEi’s immediate support at 6,000-6,100 and resistance at 6,500.

“The index now faces a psychological hurdle at the 6,500 zone, where historical selling pressure remains dense… While tame December inflation figures have supported the initial rally, a sustained move beyond 6,500 will depend on the reversal of the 2025 investment slowdown and a clearer signal that the private sector is re-engaging in large-scale capital expenditure,” the online brokerage said. — A.G.C. Magno