The Philippine Stock Exchange Index (PSEi) extended its rebound on Friday, while the peso weakened anew as markets weighed progress in US-Iran peace negotiations against persistent global dollar strength.
The PSEi climbed 0.69 percent to 5,961.40, supported by overnight gains on Wall Street and easing geopolitical concerns following renewed signs of progress in US-Iran negotiations.
The latest signals from Washington came through a combination of official statements, diplomatic leaks, and shifts in US military posture that markets interpreted as reducing the immediate risk of a wider Middle East conflict.
Over the past 24 hours, US President Donald Trump said negotiations with Iran were already in the “final stages,” adding that both sides were “getting close to something substantial.” Earlier reports cited US and Gulf diplomatic sources saying backchannel talks had accelerated through Omani mediators, with discussions focused on limiting Iran’s uranium enrichment in exchange for partial sanctions relief and eased restrictions on Iranian oil exports.
Markets reacted positively because any breakthrough could significantly increase Iranian crude supply to global markets. Iran currently exports an estimated 1.5 million to 2 million barrels per day, mostly to China despite sanctions. Traders began pricing in the possibility that more Iranian oil could legally return to the market if negotiations advance further.
The improving outlook helped boost global risk sentiment overnight. Wall Street rebounded, Treasury yields stabilized, and Brent crude pulled back from intraday highs near $110 per barrel before settling lower. Asian equities, including the PSEi, took positive cues from the move.
Trading remained subdued, however, with net value turnover reaching just P3.57 billion, reflecting continued investor caution. Foreign investors also remained net sellers, posting net outflows of P172.24 million.
Conglomerates led sectoral gains, rising 1.46 percent, while services was the lone decliner, slipping 0.02 percent. Metropolitan Bank & Trust Co. (MBT) surged 4.76 percent to P66.00 to lead index gainers, while Bank of the Philippine Islands (BPI) fell 1.28 percent to P88.35.
Despite stronger equities, the peso weakened to P61.69 per US dollar from Thursday’s P61.58 close. The depreciation came as the US dollar regained strength globally after Treasury yields moved higher and investors reassessed expectations for Federal Reserve rate cuts. Stronger-than-expected US labor and services sector data reinforced the view that US interest rates could remain elevated for longer, supporting demand for dollar assets.
Geopolitical developments also remained a key market driver. Investors initially welcomed reports that Washington and Tehran were nearing a framework to ease tensions surrounding Iran’s nuclear program. However, sentiment turned cautious after conflicting statements from Iranian officials and renewed concerns over sanctions enforcement and regional security risks around the Strait of Hormuz. Oil prices consequently stabilized at elevated levels, maintaining pressure on oil-importing economies such as the Philippines.
The peso’s weakness also reflected domestic concerns, including the Philippines’ widening trade deficit and stronger import demand driven by elevated energy prices. Although the central bank has signaled its readiness to curb excessive currency volatility, traders remain cautious as the peso continues trading near historic lows against a resilient US dollar.