Global and Philippine Market Update

July 16 to July 23, 2025

Global Markets

Global Stocks surged on trade deal optimism ahead of big tech earnings.

• Major U.S. equity indexes closed at record highs, buoyed by investor optimism over a new U.S.-Japan trade deal ahead of key tech sector earnings from Tesla and Alphabet. Strong performances in industrial and energy names pushed the indices up, while weakness in companies like Enphase, and Texas Instruments highlighted continued headwinds from tariffs and tepid guidance.
  
  
• Japan and the United States finalized a trade agreement establishing a 15% reciprocal tariff on Japanese imports to the U.S., significantly lower than the previously threatened 25% rate. The deal, reached after three months of negotiations, includes Japan’s commitment to invest $550 billion in the U.S. economy and to open its market to American products such as vehicles, rice, and other agricultural goods. Japanese Prime Minister Shigeru Ishiba hailed the agreement as a balanced outcome that protects national interests, while U.S. President Donald Trump described it as a “massive deal” that will create hundreds of thousands of jobs. The accord also includes provisions for increased U.S. energy exports and expanded purchases of American defense equipment.
  
  
• S. Treasury Secretary Scott Bessent announced plans to travel to Stockholm next week for a third round of trade talks with China, aiming to extend the pause on tariffs set to expire on August 12. The negotiations follow earlier sessions in Geneva and London and are intended to boost Chinese imports of U.S. goods and stabilize global markets. Bessent emphasized the importance of quality over speed in trade agreements and dismissed calls for Federal Reserve Chair Jerome Powell’s removal, stating that Powell has the confidence of President Trump and is doing a good job. The talks may also address broader issues such as China’s purchases of sanctioned oil and its economic rebalancing. 

Philippine Stocks

Philippine Stocks edged higher on US-PH tariff deal.

• The PSEi surged by 1.67% at 6,462.25 on July 23, marking its highest level in over a week, following the announcement of a new trade agreement between the Philippines and the United States. Under the deal, the U.S. marginally reduced its import tariff on Philippine goods from 20% to 19%, a move that investors viewed positively despite it being higher than the 17% rate previously announced in April. The peso also strengthened to P56.881 levels against the dollar, its best performance in over a week. All sectoral indices posted gains, led by services and mining and oil.
  
  
• President Trump announced a new 19% tariff on Philippine goods following a bilateral meeting with President Marcos Jr. at the White House, slightly reducing the previously threatened 20% rate but still higher than the 17% reciprocal tariff set in April. Trump described the visit as “beautiful” and praised Marcos as a “tough negotiator,” while Marcos emphasized the symbolic significance of the 1% concession, citing the special relationship between the two nations. Contrary to Trump’s social media post, Marcos clarified that the Philippines will only remove tariffs on U.S. automobiles, not all goods, and will increase imports of soy, wheat, and medicine from the U.S. The U.S. remains a top export destination for the Philippines, accounting for 16% of exports, including semiconductors and electronics. The Department of Economy, Planning, and Development noted that the 19% rate places the Philippines second only to Singapore among ASEAN countries in terms of favorable U.S. tariff treatment.

Philippine Bonds

Philippine Bond yields slipped amid jumbo RTB plan & tariff deal optimism.

• The Philippine government fully awarded its Treasury bond and bill offerings this week amid strong investor demand and declining yields. The BTR upsized its T-bill award to P28.4 billion as rates fell across all tenors, with the 91-day, 182-day, and 364-day papers fetching lower average yields than previous auctions and secondary market benchmarks. It also raised P20 billion from reissued seven-year Treasury bonds at an average rate of 5.817%, also below comparable market levels. Both auctions were significantly oversubscribed, driven by expectations of further rate cuts and reinvestment demand ahead of P516 billion in maturing retail Treasury bonds.

• The Philippine government is preparing to launch an RTB offering worth P200 billion in the third quarter of 2025, as part of its P2.545-trillion borrowing program for the year. Finance Secretary Ralph G. Recto confirmed the issuance, which will be the 31st tranche of RTBs, with proceeds earmarked for priority public projects such as infrastructure, healthcare, education, and agriculture. To make investing more accessible, the RTBs will be available through the GCash app via GBonds, with a minimum investment of P5,000 and no transaction fees during the two-week primary issuance. About 20% of the offer will be open to offshore investors. Analysts expect strong demand due to favorable yields and the bonds’ reputation as low-risk instruments. The government is targeting an 80:20 borrowing mix in favor of domestic sources to help cover a projected P1.561-trillion budget deficit

FWD Guidance: Uncertainty leads to downside risks, but diversification and a long-term investment horizon still provide the best chance for financial success.

Sources:(1) https://www.bworldonline.com/stock-market/2025/07/23/687104/psei-jumps-to-6400-level-after-phl-us-tariff-deal/ (2) https://www.bworldonline.com/top-stories/2025/07/22/686571/phl-eyes-p200-b-rtb-offer-in-q3/ (3) https://www.bworldonline.com/top-stories/2025/07/24/687145/trump-sets-19-tariff-on-phl-goods/ (4) Gov’t fully awards T-bonds amid robust demand - BusinessWorld Online, (5) https://www.bworldonline.com/banking-finance/2025/07/22/686547/yields-on-treasury-bills-decline-across-all-tenors/ (6) US-Japan trade deal: Trump announces ‘massive’ agreement, including 15% ‘reciprocal’ tariffs on exports | CNN Business (7) https://www.msn.com/en-us/news/other/bessent-to-visit-stockholm-for-china-trade-talks-rejects-push-for-powells-exit/ar-AA1J4gG1?ocid=BingNewsSerp (8) https://www.investopedia.com/dow-jones-today-07232025-11777359

Disclaimer: The purpose of this article is to inform and should not be taken as an advice or offer to purchase securities. Seek professional advice before making a decision based on this presentation. Information given does not represent the views of FWD and its agents and employees.