The benchmark Philippine Stock Exchange index (PSEi) closed Monday at 5,869.49, down 1.73 percent, as the local market began Holy Week trading on a negative note, while the peso slid to yet another record low.

Investor sentiment remained weak amid the ongoing conflict in the Middle East, with hopes for negotiations fading. Since the escalation at the beginning of the month, the local bourse has repeatedly declined at the start of the trading week, posting losses on four consecutive Mondays and averaging a 1.84 percent drop at each reopening.

Developments over the weekend weighed heavily on the market’s reopening, including further increases in global oil prices following Yemen’s Houthi forces formally joining the conflict, as well as continued peso depreciation, with the currency hitting successive record lows on Friday and Monday.

Heightened concerns over the country’s inflation outlook also added to investor pessimism. Government officials have warned that, under a worst-case scenario, inflation could rise to 14.3 percent by April if global oil prices reach $200 per barrel.

Trading was active, with net value turnover reaching P7.31 billion, above the year-to-date average of P6.47 billion. Foreign investors continued to exit, recording net outflows of P1.55 billion.

Sector performance was broadly negative, with only Services posting a marginal gain of 0.03 percent, while banks led the losses, down 3.25 percent. Market breadth was decisively weak, as decliners outnumbered advancers, 126 to 74. At the stock level, DMCI Holdings emerged as the top gainer, rising 2.78 percent to P9.99, while Ayala Land was the worst performer, plunging 7.30 percent to P16.26.

On the currency front, the peso depreciated further to a new record low of P60.69 per US dollar, weakening from the previous record close of P60.55. The move reflects sustained pressure from both global and domestic factors.

Over the past week, the escalation of the US–Israel–Iran conflict has driven a sharp spike in oil prices — now hovering above $100 to $115 per barrel — as supply risks intensify due to disruptions in the Strait of Hormuz, a critical route for about 20 percent of global oil trade.

In the past 24 hours, markets have reacted to worsening geopolitical signals, including continued military deployments and threats of further escalation, keeping energy markets tight and risk sentiment fragile.

This has boosted the US dollar as a safe-haven asset while increasing demand for dollars from oil-importing countries such as the Philippines. At the same time, the domestic backdrop remains challenging: the Bangko Sentral ng Pilipinas has raised its inflation outlook to 5.1 percent and signaled limited ability to counter supply-driven price pressures, further weighing on the currency.

Together, these forces — surging oil prices, persistent geopolitical risks, a stronger dollar environment and rising inflation expectations — have pushed the peso to fresh record lows while simultaneously pressuring Philippine equities.