Philippine Stock Market Analysis: World's Worst Performing Market Over Past Decade

This analysis is based on recent reports from South China Morning Post [1], Business Times [2], and Bloomberg [3] highlighting the Philippine Stock Exchange’s decade-long performance crisis. The PSEi has fallen approximately 17-20% since 2015-2016, standing in stark contrast to regional benchmarks that have gained 70-83% over the same period [1][2][3].

The Philippine market suffers from deep-rooted structural problems that distinguish it from regional peers:

: The MSCI Philippines Index contains only 11 members, with over two-thirds concentrated in financials and industrials [2]. This concentration contrasts sharply with more balanced regional markets like Malaysia, Indonesia, and Thailand, which include significant exposure to consumer, technology, and healthcare sectors.

: The Philippines has seen dramatically fewer new listings compared to regional competitors. Over the past five years, newly listed firms have experienced average share declines of about one-third, while Southeast Asian peers collectively gained nearly 50% [2]. Major companies including Hann Holdings (₱11.8 billion IPO postponed) and fintech giant GCash (listing delayed to H2 2026) have delayed or cancelled offerings [2].

: Market data reveals a severe confidence crisis among international investors. “Foreign investors don’t pay attention to the Philippine stock market,” stated Isidro Consunji, chairman of DMCI Holdings and Semirara Mining & Power [2]. This abandonment persists despite strong corporate fundamentals - companies like Semirara Mining & Power (net income up 80% over past decade, shares down) and DMCI Holdings (profits up nearly 50%, shares down 9%) demonstrate that solid business performance is not translating to stock gains [2].

As of November 7, 2025, the PSEi stood at 5,759.37 points, down 1.31% on the day [4]. Recent performance trends show continued deterioration:

• 5-day performance: -2.87%
• 1-month performance: -4.61%
• 3-month performance: -9.15%
• Year-to-date: Approximately -11% [1][2][4]

The market’s 52-week range of 5,722.71 - 7,010.02 [4] indicates it’s trading near decade lows, with approximately $325 billion in market capitalization across 286 listed companies [1].

The fundamental issue plaguing the Philippine market is not economic performance but a crisis of confidence. “What is the most important ingredient in the stock market? Confidence. But there is none,” stated Ramon Monzon, CEO of the Philippine Stock Exchange [2]. This confidence deficit has created a self-reinforcing cycle where poor market performance discourages new listings, which further reduces market attractiveness.

Market experts warn of increasing irrelevance. “The risk is the Philippines might become so marginal, people will stop looking at us,” warned Eduardo Francisco, president of BDO Capital & Investment [2]. This marginalization risk is particularly concerning given the Philippines’ position as Southeast Asia’s fifth-largest economy, suggesting a significant disconnect between economic fundamentals and market performance.

Regulators are attempting to address these structural issues through several initiatives:

• The Securities and Exchange Commission is pushing state-owned firms to go public
• New guidelines for foreign investors are being rolled out
• The Maynilad Water Services IPO, potentially the country’s largest since Monde Nissin’s 2021 debut, could serve as a critical market sentiment test [2]

: The market’s problems appear deeply rooted rather than cyclical. Limited diversity, poor IPO performance, and foreign investor abandonment suggest these issues may persist without fundamental structural changes.

: The market suffers from a dangerous cycle where poor performance erodes confidence, which in turn drives further performance declines. Breaking this cycle requires significant catalysts.

: The widening gap between Philippine market performance (-17% to -20% over decade) and regional peers (+70% to +83%) [1][2][3] could lead to permanent capital reallocation away from the Philippines.

: This offering represents a crucial litmus test for investor appetite. A successful debut could signal renewed market confidence, while failure would reinforce negative sentiment.

: Concrete actions rather than promises are needed. The effectiveness of new foreign investment guidelines and state-owned privatization efforts will be critical indicators.

: Continued central bank rate cuts could provide some market upside [2], though monetary policy alone cannot address structural confidence issues.

The Philippine stock market represents an anomaly in global finance - a market where strong corporate fundamentals and economic growth have failed to translate into investor returns over a decade-long period. The 17-20% decline in the PSEi since 2015-2016 [1][2][3] reflects structural issues including limited market diversity, failed IPO markets, and evaporated foreign confidence.

Current market data shows the PSEi at 5,759.37 points [4], trading near decade lows with year-to-date declines of approximately 11%. The market’s $325 billion capitalization across 286 companies [1] suggests significant value destruction relative to underlying economic fundamentals.

For market participants, the critical question is whether regulatory reforms and upcoming IPOs can break the confidence crisis that has marginalized the Philippine market. Historical precedents suggest successful market recoveries require strong regulatory action, successful large-scale offerings, sustained economic growth, and transparency improvements - all elements currently lacking in the Philippine context.