Market direction to depend on Mideast conflict

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March 30, 2026 | 12:00am

MANILA, Philippines — Investors are expected to remain on the sidelines this shortened trading week while waiting for developments on the ongoing Iran war.

“The Philippine Stock Exchange index (PSEi) will take inspiration from US-Iran ceasefire talk progress and claw back above 6,000, but any failure to reach a deal followed by war escalation news could make PSEi test the support of 5,800,” First Metro Investment Corp. head of research Cristina Ulang said.

The benchmark PSEi finished on a sour note last Friday at 5,972.83, down by 0.76 percent week-on-week,  with the market remaining focused on what is happening the Middle East.

Unicapital Securities head of research Wendy Estacio-Cruz said sentiment remained cautious last week amid the lingering impact of Middle East tensions, clouding the prospects of a near-term resolution.

Meanwhile, she said the Bangko Sentral ng Pilipinas’ decision to keep interest rates steady further weighed on the peso.

“We believe the market is now turning its attention to key domestic data catalysts, especially the release of March inflation data on April 7, which could provide clearer direction for monetary policy expectations,” Estacio-Cruz said.

For 2TradeAsia.com, the online arm of F. Yap Securities Inc., “this is a week for discipline and a season for introspection, heading into a low-liquidity week amid the Lenten break.”

There will be no trading on April 2, Maundy Thursday, and April 3, Good Friday.

Philstocks Financial research manager Japhet Tantiangco said the market remains at bargain levels as of last Friday’s closing, with the PSEi trading at a price-to-earnings ratio of 10.1x, below its last five years’ average of 14.4x and the regional average of 17.8x.

This week, Tantiangco said the local market is still expected to have a bearish default due to rising inflation expectations amid the uncertainties of the US/Israel-Iran war, with its trading range seen from 5,800 to 6,000.

He said investors are likewise expected to trade cautiously ahead of the long weekend.

“The elevated oil prices and the weak position of the peso are expected to continue weighing on market sentiment. Investors are also expected to monitor further developments in the conflict in the Middle East,” he said.