Q3-2026 Market Outlook

August 01, 2026

 


Local Fixed Income

With local inflation expected to remain above the Bangko Sentral ng Pilipinas’ target, PHP bond yields are likely to continue rising in the coming months. The key milestone here is a resolution to the geopolitical tensions in the Middle East as this has led to a rise in oil prices and, in turn, Philippine inflation.

 


Local Equities

Philippine equities appear better positioned heading into the second half of 2026, with improving market sentiment and attractive valuations providing support for returns. Although earnings growth remains modest and investors may continue to face periods of volatility, much of the bad news appears to be already reflected in current stock prices.



Global Fixed Income

Global bonds can deliver steady income and competitive risk-adjusted returns through the remainder of 2026, supported by still-attractive yield levels. Although markets may experience bouts of volatility as investors reassess inflation and interest rate expectations, today’s higher bond yields provide a stronger starting point than in recent years.

 

Global Equities

Global equities continue to benefit from robust earnings growth and powerful structural trends led by artificial intelligence. Although markets may experience short-term fluctuations as investors navigate inflation, interest rates, and geopolitical headlines, the overall backdrop remains supportive for equities.

 

 

Sources: Bloomberg, Sun Life Asia Asset Management, SLIMTC

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