The Weekly Review

Local equities rose amid continued bargain hunting and increased net foreign inflows. This was also after headline inflation remained below the Bangko Sentral ng Pilipinas' (BSP) 2-4% target in December at 1.8%, and BSP Governor Remolona's remark that a February rate cut is on the table.

​Top performers were International Container Terminal Services, Inc. (PSE Ticker: ICT; +12.51%), Jollibee Foods Corp. (JFC; +12.32%), and Aboitiz Equity Ventures, Inc. (AEV; +11.35%). Meanwhile, JG Summit Holdings, Inc. (PSE Ticker: JGS; -1.62%), Converge Information and Communication Technology Solutions, Inc. (CNVRG; -1.94%), and Alliance Global Group, Inc. (AGI; -3.88%) were the laggards.

▲ The PSEi closed at 6,348.14 (+3.47% WoW). ​

Local fixed income yields declined as investors weighed (1) BSP Governor Remolona’s remarks that a February rate cut is on the table, and (2) the government’s downwardly revised growth forecasts of 5%-6% for 2026 and 5.5%-6.5% for 2027. 

▼ On average, yields fell by 5 bps, with the 2Y closing at 5.29% (-6 bps) and the 10Y closing at 6.03% (-2 bps).

The Philippine peso weakened as the BSP signaled the possibility of a policy rate cut in February. 

▲ The USD/PHP pair closed at 59.25 (+0.69% WoW).

US equities climbed, driven by a rally in energy, defense and tech stocks. Gains were fueled by optimism over Nvidia’s next-gen AI chip production, hopes for US oil benefits from Venezuela’s rebuilding of oil infrastructure, and Trump’s call for a $1.5 trillion defense budget in 2027.​

▲ S&P 500 closed at 6,966.28 (+1.57% WoW).​

▲ DJIA closed at 49,504.07 (+2.32% WoW). 

US Treasury yields ended mixed following the release of several US jobs data. These include: (1) the below-consensus job openings of 7.15 million as of November (Consensus: 7.65 million), (2) the lower-than-expected December nonfarm payroll additions of 50,000 (Consensus: 70,000), and (3) the better-than-expected December unemployment rate of 4.4% (Consensus: 4.5%). 

▼ On average, yields fell by 1 bp, with the 2Y closing at 3.53% (+6 bps) and the 10Y closing at 4.17% (-3 bps).

The US dollar strengthened following the stronger US nonfarm productivity gains in 3Q25 and the narrower US trade deficit in October. The greenback was also supported by a weaker Euro after the softer December inflation in Germany and France supported views that the European Central Bank could hold rates steady. 

▲ The DXY closed at 99.13 (+0.72% WoW). 

Sources: BusinessWorld, Inquirer, Philippine Star, Manila Bulletin, Businessmirror, PSE Edge, Bloomberg, CNBC, Reuters, CNN, Wall Street Journal, Financial Times, Market Watch

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