With improving economic conditions, policy support and structural growth drivers, First Metro Securities Brokerage Corp. (FirstMetroSec) expects a stronger equities market this year.

Reuben Mark Angeles, FirstMetroSec first vice president and head of equity research, said Tuesday that business activity is rebounding as inflation eases, economic data improves and monetary policy becomes more accommodative.

“The market is positioned for a turnaround,” Angeles said, projecting the Philippine Stock Exchange Index (PSEi) to reach 7,600, with a broader range of 6,600 to 8,600.

He said market momentum will be driven by a possible reduction in stock transaction taxes, an upgraded credit outlook, and increased domestic consumption before the midterm elections.

Luzon economic corridor

Structural growth opportunities are also emerging, particularly with the Luzon Economic Corridor, a trilateral initiative between the US, Japan, and the Philippines that positions Clark, Pampanga, as a future economic hub.

Despite global uncertainties, FirstMetroSec said the Philippines remains resilient due to its domestically driven economy, ample reserves, and strong political ties with the US.

While former US President Donald Trump’s policies introduce some risks, the firm noted that many of these concerns have already been factored into valuations.

GDP growth to 6%

Ateneo Center for Economic Research and Development director Ser Percival Peña-Reyes said GDP growth could reach 6 percent, supported by improving fundamentals. However, he cautioned that sustained expansion should come from meaningful investments rather than short-term election-driven spending.

“We want spending to have a lasting impact, creating jobs and strengthening industries rather than fueling temporary consumption,” Peña-Reyes said.

He added that inflation is expected to stay within the Bangko Sentral ng Pilipinas’ 2-4 percent target range, maintaining price stability and supporting economic activity.

Estella Dhel Villamiel, FirstMetroSec’s institutional research head, identified key investment themes for 2025, including early-cycle recovery, midterm election plays and companies benefiting from AI-driven efficiency gains.

“The Year of the Snake presents a fresh chance to approach the market differently. Stay agile, focused, and ready to shed what’s holding you back,” said FirstMetroSec senior vice president Mhelvin Abajon, acknowledging the challenges of 2024 while encouraging investors to seize opportunities in 2025.