PSEi seen testing 6,500

Philippine stocks may continue to move higher this week and test the 6,500 level as investors respond positively to the Bangko Sentral ng Pilipinas’ (BSP) latest interest rate cut. Still, lingering risks could temper gains, brokerage 2TradeAsia said.

The local bourse recently reclaimed the 6,400 mark after the BSP reduced policy rates by 25 basis points to 4.25 percent. This helped offset concerns over economic growth and cautious risk appetite.

The benchmark Philippine Stock Exchange Index rose roughly 96.57 points to close at 6,465, gaining 1.5 percent week-on-week.

This was driven mainly by strong performances from mining and oil firms, which jumped 4.4 percent and services, which climbed 2.3 percent.

Despite the advance, market participation remained weak. Average daily turnover slipped to P6.65 billion, down 12.6 percent.

Meanwhile, net foreign buying slowed sharply to P135 million, a 48.5-percent drop, leaving decliners ahead of advancers, 111 to 97.

According to 2TradeAsia, the BSP’s policy easing signals a more supportive environment for equities. This, especially as inflation pressures stabilize and expectations of further rate cuts persist.

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The brokerage said this could help improve investor sentiment and encourage a gradual shift toward riskier assets.

Still, the firm noted that earnings growth expectations for listed companies remain modest. Full-year 2025 results are seen expanding by low double digits.

Political uncertainties, currency volatility and external headwinds may also continue to limit foreign fund inflows.