Just like bourses worldwide, the Philippine stock market will mainly be influenced by developments in the Middle East, where the war started by the United States (US) and Israel against Iran is threatening the global supply chain and sending oil prices through the roof.

While share prices have fallen to bargain levels in the past week due to the war, Philstocks Financial Inc. research manager Japhet Tantiangco said the market is seen to move sideways this week despite some bargain hunting.

“A strong rally is not yet expected as worries over rising oil prices amid the Middle East conflict may continue to dampen sentiment. Investors are expected to watch out for the government’s policy measures to mitigate the economic effects of the rising oil prices,” he noted.

Investors are also expected to watch out for more corporate earnings results, which could influence individual stock movements.

Tantiangco warned that the local market’s chart has been showing bearish signs recently, with technical indicators implying short-run bearish momentum.

Online brokerage 2TradeAsia.com said that, amid the heightened risk environment, sentiment remains extremely cautious and funds are likely to keep sidelined as energy costs remain elevated.

It noted that high energy costs further complicate the global central bank pivot toward lower interest rates.

“Domestically, locals are bracing for volatility following February’s inflation print (2.4 percent, within estimates), making the Bangko Sentral ng Pilipinas’ (BSP) path likewise more delicate for 2026,” the firm said.

It said investors should anticipate equities to glide alongside upcoming fiscal intervention as the government’s economic team tries to build fiscal safeguards to mitigate Middle East-driven shocks, focusing on fuel subsidies and food security to anchor consumer spending.

“We anticipate sector rotation in the immediate term: energy and commodity-linked stocks stand to benefit from price spikes, while interest-rate-sensitive sectors and transport and tourism may face headwinds,” 2TradeAsia.com said.

Thus, it advises investors to maintain a defensive posture leaning toward high-dividend yielders and liquid large caps that can weather short-term capital outflows while on the lookout for eventual valuation gaps that appear when the dust settles.

For stock picks, Abacus Securities Corp. is even more bullish on International Container Terminal Services Inc. (ICTSI) after the Enrique K. Razon Jr.-led firm reported strong 2025 earnings growth. While the Middle East war will have an impact on global trade, Abacus said ICTSI’s new port operations in Durban, South Africa, and Indonesia should more than mitigate this.

It added that it is even more optimistic about ICTSI’s earnings growth in 2027, when operations at the new ports have been optimized.

Meanwhile, both COL Financial Services Inc. and Unicapital Securities Inc. have BUY ratings for Gokongwei-led Robinsons Retail Holdings Inc. (RRHI) as it remains undervalued, especially in light of its strong 2025 performance.

“We are updating our earnings forecasts for RRHI following the release of its fiscal year (FY) 2025 unaudited results and the expected sales and earnings contribution from the Premiumbikes acquisition,” COL said.

Excluding the market value of its stake in Ayala-led Bank of the Philippine Islands (BPI), COL estimates that the market is only valuing RRHI’s retail business at 2.9 times its expected earnings for 2026.

Meanwhile, Unicapital research analyst Jeri R. Alfonso said they are maintaining the BUY rating on RRHI as it sees a 41-percent upside from current levels even after revising their target price lower by 19 percent, mainly to factor in potential margin pressure from elevated oil prices stemming from the ongoing US-Iran-Israel conflict.

“While 2025 core results were broadly in line with expectations, higher fuel costs could weigh on margins in the coming quarters, particularly in the food segment, which accounts for about 60 percent of RRHI’s total revenues,” she said.

However, on valuation, Alfonso sees the stock trading at a 58-percent bargain to its 10-year historical average of an 18.4 times price-to-earnings (P/E) ratio.