Weekly Wrap: Mixed signals test global markets

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Philstar.com

January 16, 2026 | 7:00am

Macro

Global: The US economy looks a bit unclear right now. Inflation slowed to 2.7% in November from 3.0% in September, but we don’t have October data, so the picture is incomplete. Jobs improved, with 64,000 added in November after a big loss of 105,000 in October because of government spending cuts. Unemployment went up slightly to 4.6% from 4.4%, but fewer people are filing for jobless claims now, which is good news. Retail sales did not grow in October, but people still seem to be spending as the holiday season begins.

Local: Filipinos working abroad are still sending money home, and it is helping the Philippine economy. Remittances grew 3% to USD3.17bn in October, bringing the year-to-date total to USD29.2bn, up 3.2%, which is better than expected. This money helps families spend more, and since household spending makes up about 70% of the Philippine economy, that’s very important. It also helps keep the peso stable and strengthens the country’s foreign exchange reserves. Simply put, remittances are a big reason why the Philippine economy stays strong even when global conditions are tough. 

Bonds

Global: US Treasury yields declined w-w (see Fig. 1) as lower inflation and mixed employment data supported expectations of further rate cuts by the Federal Reserve. Recent commentaries from Fed officials also suggest a slow, data-dependent path to easing, with inflation still central and labor market softness gaining attention. 

Local: Domestic yields traded mixed last week (Fig. 2), with the 3M at 4.8496% (down) and 5Y at 5.7018% (up), on light market activity ahead of the holidays. The BSP also signaled its easing cycle may be nearing its end, with at most one more cut possible, though US policy developments remain a key consideration for its stance.

Equities

Global: Global stock markets had varied performances as investors parsed through delayed economic releases from the US, weak manufacturing data in China (4.8% y-y vs. 5.0% consensus est., 4.9% in October), and mixed interest rate decisions from central banks in Europe (the BOE reduced policy rate to 3.75% and cued for a slower pace of lowering borrowing costs ahead, while the ECB kept rates steady at 2.0% and signaled a likely end to its easing cycle) and Japan (the BOJ raised rates to 0.75% with hints of more hikes ahead). Oil prices also fell (Dubai Crude -3.1% w-w to USD59.64) on Russia-Ukraine peace talks.

Local: The PSEi slid to 5,920.87 last Friday (-1.8% d-d, -1.9% w-w) with foreigners still net sellers for the week at PHP1.9bn (from PHP4.5bn previously) on cautious trading, while the PHP firmed up (+0.6% w-w to PHP58.70/USD) on seasonal remittance inflows and easing global oil prices. Index losers were led by ICT (-9.9% w-w), CNVRG (-6.3% w-w), and PGOLD (-6.0% w-w) as investors took profit from previous weeks’ gains. However, CBC (+9.6% w-w) bounced back from near 52-week lows on bargain hunting, ACEN (+4.5% w-w) rallied on privatization rumors, and consumer-centric conglomerates AGI (+8.8% w-w), GTCAP (+5.1% w-w), and SMC (+4.2% w-w) advanced with resilient OFW remittances seen to support consumption spending. 

Market insights

The local stock market is down 1.7% so far this month and 9.3% for the year, as investors worry about slower growth and global uncertainty. Still, Philippine stocks are much cheaper compared to other countries, which could mean good short-term opportunities in beaten-down shares that are expected to deliver solid earnings and dividends. 

For long-term investing, we suggest investors stick to the basics. We like companies that are steady and less risky—those tied to everyday spending like Jollibee, Century Pacific, SM, and GT Capital. We also favor businesses that provide essential services and regular income, such as Meralco, Manila Water, Converge, and MREIT. These names can help protect your portfolio when the market gets volatile.

Corporate updates

ALI is targeting families seeking leisure activities within its 62-hectare eco-tourism hub Arillo Estate in Batangas by opening a new horseback riding facility, offering scenic rides for casual and experienced riders. Arillo is located in Barangay Caylaway in Nasugbu and boasts proximity to the town’s beaches. It is accessible via major roads, including the South Luzon Expressway, Cavite-Laguna Expressway, Manila-Cavite Expressway, and the Nasugbu-Tagaytay Highway.

The ERC has approved NGCP’s PHP13bn grid infrastructure project in Camarines Sur designed to support offshore wind development in the area (around 6 projects with total potential capacity of 3,100MW) and increase in the transfer capacity of the Luzon-Visayas link. NGCP will build the proposed Milaor 500-kilovolt substation in phases: 1) installing an initial 1,000-megavolt-ampere (MVA) transformer, scheduled for completion in 2027; 2) another 1,000MVA transformer, planned for completion in 2030. 

Disclaimer: The information, opinions and analysis contained herein are based on sources and data believed to be reliable but no representation, expressed or implied, is made as to its accuracy, completeness or correctness. This material is only for the general information of the authorized recipients. In no event shall BDO or its officers and employees, including the author(s), be liable for any loss/damage resulting from reliance, directly or indirectly, or information found within this report.