The Philippine Stock Exchange index (PSEi) could finish the year at around 7,100 points, supported by solid corporate earnings and improving economic conditions, according to Philstocks Financials Inc. If reached, this level would signal renewed confidence in the stock market after recent volatility and reflect better prospects for listed companies.
Philstocks said earnings of PSEi firms are expected to grow by an average of 15 percent, driven by steady consumer demand, business expansion, and better use of technology. It also expects the Philippine economy to grow by 5 percent in 2026, faster than the estimated 4.4 percent growth in 2025, helped by easier monetary policy from the Bangko Sentral ng Pilipinas (BSP).
The broker expects the BSP to cut interest rates another time this year, bringing the policy rate to 4.25 percent, to support economic growth after last year’s weak performance. While inflation is seen rising to 3.2 percent from 1.7 percent last year due to stronger demand and a weaker peso, it remains within manageable levels. The peso is forecast to average P59.50 to the dollar this year, weighed down by a likely balance of payments deficit.
Lower interest rates are expected to benefit key sectors. Property developers may see stronger demand as home loans pick up, while banks are likely to benefit from higher loan demand from both households and businesses. Consumer-related firms could gain from improved employment, easier credit, and steady overseas remittances. Mining stocks, particularly nickel producers, are also seen to perform well as demand for electric vehicle batteries rises amid tighter global supply.
Overall, a year-end PSEi level of 7,100 would point to a healthier market environment, offering better opportunities for investors and signaling a gradually strengthening economy.
