Typhoon threat, 'AI bubble' jitters add to stocks caution
Published Nov 10, 2025 12:00 am
Cautious trading is expected in the local stock market this week as investors continue to weigh the impact of the lower-than-expected economic growth pace announced last week, though foreign direct investments and corporate earnings reports could spur bouts of bargain hunting.
“For next week, the local bourse is expected to move sideways as negative sentiment continues to weigh on investor confidence,” Philstocks Financial Assistant Research Manager Claire Alviar said.
Alviar noted that the market may still be digesting the slower-than-expected third-quarter gross domestic product (GDP) growth while awaiting the release of foreign direct investment (FDI) data. She added, "A strong FDI print could help lift sentiment, but a disappointing result may reinforce the prevailing bearish mood.”
Locally, the potential impact of an approaching super typhoon could further dampen sentiment, particularly after the recent destructive weather in the Visayas. Overseas, concerns about a possible ‘AI tech bubble’ are also adding pressure to market sentiment, Alviar said.
Chinabank Securities Corp. Research Director Rastine Mercado called it a “pivotal week ahead as [the] index could test 5,700 support even as prevailing valuations attract bargain hunters.”
“While the resurgence of buying appetite towards Friday's close could carry into Monday, we think investors will initially adopt a wait-and-see mode as they monitor lingering selling pressure following the lackluster third-quarter 2025 GDP print,” he added.
Mercado pointed out that “some index heavyweights posted net foreign inflows despite Friday's sell-off, which supports our view that prevailing valuations continue to attract buying appetite despite negative near-term sentiment.”
Online brokerage 2TradeAsia.com advised that “guidance from third-quarter earnings calls should keep trades a bit less anemic, but escape velocity for the broader index will likely have to emanate not from corporate stories but from fiscal reforms and a recovery story as early as the first quarter.”
The brokerage expects funds to “trim duration and rotate into defensive sectors (financials and consumer staples), which offer yield cushions amid GDP softness that risks spilling into the fourth quarter.” It maintained a "cautious trades" stance, adding: “Take note of dips that provide comeback alpha during periods of maximum pessimism.”
For stock picks, Unicapital Securities Research Analyst Peter Louise D. Garnace is recommending Manila Electric Co. (MER), raising its target price by 8% to ₱640 per share after its "core earnings beat our estimates and as we shift our valuation base to next year.”
“The continued expansion of MER's generation segment is the key driver for our favorable view, underpinning our expectation of sustained growth momentum,” Garnace said.