Philippine equities rebounded on Tuesday after a sharp sell-off at the start of the week, as investors reassessed geopolitical risks linked to escalating tensions in the Middle East.
The Philippine Stock Exchange Index (PSEi) had fallen nearly four percent in early trading on Monday, dropping to around 6,085 points, as global markets moved into risk-off mode following a surge in crude oil prices. Brent and West Texas Intermediate crude both moved above the 100-dollar per barrel level, triggering concerns about renewed inflation pressures and potential disruptions to global energy supply.
The sell-off in Manila mirrored declines across regional markets. South Korea’s Kospi and Japan’s Nikkei 225 both recorded significant losses as investors shifted away from risk assets amid rising geopolitical uncertainty.
However, the Philippine market stabilised quickly. By Tuesday afternoon, the PSEi had recovered to approximately 6,126, gaining around two percent from Monday’s lows. Buying interest returned to large-cap names, particularly financials and conglomerates. BDO Unibank, Bank of the Philippine Islands, and Ayala Corporation were among the stocks leading the rebound.
Market breadth also improved notably, with advancing issues outnumbering decliners, suggesting selective bargain hunting following the sharp drop.
Despite the volatility, the broader investment narrative for the Philippines remains largely unchanged. The country’s equity market continues to be driven primarily by domestic consumption and infrastructure investment. Nevertheless, sustained increases in global oil prices could present a headwind, as the Philippines remains a net energy importer.
For investors, the key variable in the near term will be whether geopolitical tensions continue to push energy prices higher. If crude prices stabilise, regional equity markets—including the Philippines—may see further recovery after this week’s sharp risk-off reaction.
Reference
PSEi sinks nearly 4% on escalating Middle East conflict. Inquire.net
https://business.inquirer.net/578270/psei-sinks-nearly-4-on-escalating-middle-east-conflict