PSEi outlook positive for 2026, analysts say

PSEi Outlook Shifts Positive Analysts Eye Easing Inflation and Interest Rate Cuts in 2026

The Philippine stock market has seen a turnaround in its prospects, with analysts predicting an upswing in 2026. As inflation eases and interest rates potentially come down, the stage is set for a recovery, despite ongoing volatility.

A Mixed Year in Review

In 2025, the Philippine Stock Exchange index (PSEi) ended the year slightly lower at 6,052.92, having spent most of December above the 6,000 level. Although it declined by 7.29 percent for the full year, marking its fifth drop in six years, analysts believe that the market's performance reflected fragile investor confidence rather than a fundamentally weak market.

Resilience in Sectors

Despite the broader weakness, some sectors demonstrated resilience. Mining stocks outperformed due to favorable commodity price movements, while bank shares fared better during periods of supportive macroeconomic data and expectations of improving credit growth.

Positive Outlook for 2026

Wendy Estacio-Cruz, managing director at Unicapital Securities, expects the market's performance to improve in 2026, driven by easing inflation and potential interest rate cuts. She notes that consumer-oriented and rate-sensitive stocks underperformed in 2025 due to cautious spending outlooks and earnings disappointments among several index heavyweights.

Sector Outlook Mining, Utilities, and Real Estate

Equity Research Analyst Shawn Ray Atienza predicts that mining stocks will be among the outperformers in early 2026, supported by elevated precious metal prices. He also expects utilities and real estate investment trusts to benefit as investors favor defensive and income-generating assets in a lower interest rate environment.

Key Factors to Watch

Atienza highlights government and consumer spending, along with a recovery in tourism and the property sector, as key factors to watch in 2026. RCBC chief economist Michael Ricafort agrees, adding that further progress on governance and anti-corruption reforms could help restore investor confidence.

Conclusion A Shift in PSEi Outlook

In conclusion, analysts believe that the Philippine stock market's outlook has shifted positive for 2026, driven by easing inflation, potential interest rate cuts, and relatively attractive valuations. While volatility may persist, the stage is set for a recovery, making it an exciting time to monitor the PSEi's performance in 2026.

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Edward Lance Arellano Lorilla

CEO / Co-Founder

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