The PSEi ended slightly lower after a week of consolidation, dropping by 0.87% week-on-week to close at 6,339.77 (-55.82 points). Investors remained cautious throughout the week as the Israel-Iran conflict drove oil prices higher and stoked inflationary fears. This created uncertainty ahead of Thursday\u2019s monetary policy decisions by the US Federal Reserve and the Bangko Sentral ng Pilipinas (BSP), though bargain hunting helped minimise the market\u2019s losses. <\/p>\n\n\n\n
As it happened, the Fed kept its benchmark rate unchanged at 4.25-4.50%, citing inflation risks and slower growth expectations due to tariffs and geopolitical uncertainties. Meanwhile, the BSP cut the target reverse repurchase rate (RRP) by 25 basis points (bps) to 5.25%, as lower inflation forecasts for 2025 (from 2.4% to 1.6%) allowed the central bank to support economic growth. Despite dovish BSP language, substantial foreign outflows dragged the market as the week concluded, with geopolitical tensions continuing to weigh on investor confidence and portfolio rebalancing activities in line with changes to the Financial Times Stock Exchange (FTSE) Global Equity Indexes (effective 23 Jun 2025) adding to market volatility.<\/p>\n\n\n\n
We expect risk-off sentiment to continue this week amid major escalations in geopolitical tensions. The US has decisively joined Israel\u2019s war on Iran by striking three key nuclear facilities in Fordo, Natanz, and Isfahan, with President Donald Trump warning of further strikes if Iran fails to concede. In response, Tehran has launched missiles at Tel Aviv, while the Iranian foreign ministry has issued a statement reinforcing its right to defend its sovereignty, raising fears of further retaliation. <\/p>\n\n\n\n
Locally, rising oil prices are expected to translate into substantial fuel price hikes of PHP4.90\/PHP5.10 per litre for diesel and PHP3.20\/PHP3.40 per litre for gasoline by Tuesday. Coupled with a weakening Peso as investors shift to the greenback as a safe haven asset, this poses higher risks to inflation. Nonetheless, downside may be capped as investors continue digesting recent BSP rhetoric, with the central bank’s signal of another rate cut by year-end providing some relief amid a slowing global growth outlook.<\/p>\n\n\n\n
Recommendation<\/strong><\/td>| Buy on support<\/td><\/tr> | 1-Year Target Price<\/strong><\/td> | PHP 8.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n | <\/div>\n\n\n\n RCR has been in an uptrend, trading above its key moving averages (MAs) (20-day, 50-day, 100-day, and 200-day), which signals sustained bullish momentum. However, the stock recently hit resistance after reaching a new 52-week high of PHP7.06. The RSI has moved out of oversold territory, suggesting that a short-term price correction is underway. We view this pullback as an opportunity to accumulate the stock at key support levels.<\/p>\n\n\n\n Accumulate RCR at support levels be-tween PHP6.75-7.00. Take profits at PHP7.90 and set stop loss limits at PHP6.32. For long-term investors, we have a fundamental target price of PHP8.00.<\/p>\n\n\n\n <\/div>\n\n\n\n 2. Monde Nissin Corp. (MONDE)<\/h3>\n\n\n\n
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