Philippine stock index falls 0.7% to 6,082.93 at close

Philippine stock index falls 0.7% to 6,082.93 at close

The Philippine stock index, PSEi, closed at 6,082.93 on September 2, 2025, down by 0.7% from the previous day's close. This decline follows a period of market volatility and comes amidst a backdrop of global economic uncertainty. The fall was driven by a combination of factors, including geopolitical tensions, shifts in monetary policy, and ongoing reforms in the Philippine economy.

The PSEi's performance is reflective of broader market trends, with investors cautious about the potential impact of the 2025 midterm elections and ongoing structural reforms. The government's efforts to streamline infrastructure projects and digitize public services have been met with mixed reactions, with some investors expressing concern over potential disruptions to policy momentum. However, the central bank's dovish stance and recent rate cuts have provided some support to equity markets, boosting sectors sensitive to borrowing costs.

Despite the recent downturn, the Philippine stock market remains undervalued relative to historical norms and regional benchmarks. The trailing P/E ratio of 10.46 as of August 2025 is well below the 10-year average of 15.43, signaling a significant discount to fundamentals. This valuation dislocation, coupled with near-term catalysts such as the government's 2025 reforms and monetary easing, presents a compelling case for contrarian investors.

Looking ahead, the Philippine stock market is expected to continue navigating short-term volatility while benefiting from long-term structural reforms. The OECD forecasts a GDP expansion of 5.6% in 2025, driven by strong labor markets and low inflation, while the World Bank projects a 6.8% GDP growth rate by 2040. These positive economic indicators suggest that the market is poised for recovery, offering investors a margin of safety and potential for long-term gains.

References:
[1] https://www.ainvest.com/news/philippine-equities-contrarian-buy-case-oversold-valuations-improving-fundamentals-2509/