Investors are closely watching President Marcos' State of the Nation Address (SONA) and second-quarter earnings reports, while concerns about United States (US) tariffs and recent typhoon damage weigh on sentiment.

“The local market made a comeback last week, regaining its ground above the 6,400 level as bargain hunters take opportunities,” said Philstocks Financial Research Manager Japhet Tantiangco.

He noted, though, that “trading last week was tepid, implying that the climb did not have strong conviction. Fundamentals-wise, the local market remains undervalued.”

This week, Tantiangco said, “investors are expected to watch out for fresh leads. Investors will be looking forward first to President Ferdinand Marcos Jr.’s State of the Nation Address. Detailed plans on how to keep inflation low and how to re-accelerate economic growth may boost investors’ sentiment.”

He added that investors are also expected to watch out for the upcoming second corporate reports and robust results are expected to lift the local market. Investors may also watch out for the upcoming S&P Global Philippines Manufacturing PMI for clues on the local economy.

Meanwhile, 2tradeAsia.com said “Global markets are in a holding pattern as the Fed's September meeting looms, with rates static but tensions simmering.

It noted that, “Tariff reversals and Trump's ongoing critique of Powell add noise, yet markets seem unfazed; the real test lies in the next two months given two job reports, two CPI prints, and mounting White House pressure could shift sentiment.

“If US inflation (by extension, the world) holds or dips, markets may lean harder into 2026 rate cuts… The Powell-Trump saga, with a 20 percent chance of a Fed chair shake-up, remains a tail risk—watch the space as this will likely dictate the rate path for 2026,” 2TradeAsia.com added.

At the local front, the brokerage said “The country continues to reel from consecutive July typhoons, with the most recent Typhoon Emong displacing 300,000 and affecting millions, exacerbating agricultural losses estimated at ₱454 million (particularly in rice and vegetable Luzon baskets).”

While rice prices may stabilize due to imports, 2TradeAsia.com said other food indexes could push the inflation print for the remainder of the third quarter, and an additional stress to disrupted consumer confidence.

“Additionally, the 19 percent US tariff on Philippine goods, negotiated down from 20 percent (but up from 17 percent), adds pressure, and may potentially curb export growth and investor sentiment; in this, we reiterate the PH's domestic-driven economy limits direct GDP impact, but would still bruise short-term numbers,” it added.

From a more long-term standpoint, 2TradeAsia.com said investors should expect the protracted typhoon days to cause massive infrastructure and logistics delays, although the BSP's dovish stance and potential cuts into the fourth quarter may cushion the potential domino risk (that is, if the rate path is not impaired by external forces and telegraphed rate cuts do get cut).

For stock picks, Unicapital Securities has a BUY rating on Wilcon Depot and has upgraded its target price by 23 percent.

“The adjustment reflects our revised assumptions, particularly the upward tweak in our same store sales growth (SSSG) forecast from 1.8 percent to 3.0 percent, following the 25bps interest rate cut by the Bangko Sentral ng Pilipinas (BSP) last June,” said USI Research Analyst Jeri R. Alfonso.

She added that, “we believe the onset of the rainy season, and the resulting flood damage in certain areas, could drive demand for home improvement and repair materials.”

COL Financial favors Universal Robina Corporation and has upgraded its earnings estimate because “We believe earnings recovery is underway, supported by a strengthened outlook on domestic branded consumer foods.”

“While headwinds from coffee costs and tariff-related uncertainties persist, we believe these risks are largely priced in. URC’s diversified portfolio… also provides a buffer against potential bottom-line volatility,” it added.