Market & Mainstreet
Earnings Beat the Macro Story, Gulf Shipping Attacks Resume, and China’s Factories Choose Southeast Asia
The Daily Scan – August 13, 2026 (Thu)
Corporate Philippines posted a strong earnings day, with SM Investments, Megaworld, and Monde Nissin all booking higher first-half profits and the PSEi climbing for a second straight session on bargain hunting. But the government trimmed its 2027 infrastructure spending plan and a fresh Inquirer report flagged weakening pillars behind PH growth, echoing Deutsche Bank’s cut to its 2026 forecast. Globally, renewed attacks on Gulf shipping pushed Brent crude to $88.91 a barrel just as that same growth downgrade landed, and a new survey shows Chinese manufacturers picking Southeast Asia over Latin America for overseas expansion, with Malaysia and Singapore drawing more interest than the Philippines so far.
| SM Investments H1 Profit | PSEi Close | BIR July Collections |
| P45.9B, up 8% YoY | 6,366.64, up 0.63% | P2T+, 60% of 2026 target |
SECTION 1 · Philippines
● SM Investments’ first-half profit rises 8% as consumer demand holds up across retail, banking, and property
WHAT HAPPENED
SM Investments Corp., the parent company of the SM Group, reported consolidated net income of P45.9 billion for January to June, up from P42.6 billion in the same period last year, supported by sustained consumer demand and the strength of its diversified business model across retail, banking, and property.
UNCERTAIN
The release doesn’t break out how much of this growth reflects genuine underlying demand versus seasonal or pre-emptive spending ahead of expected price pressure later in the year.
WHY IT MATTERS
SM’s performance is often read as a proxy for mall traffic and middle-class spending nationwide, so an 8% profit rise is a meaningfully positive signal at a moment when other indicators, like the infrastructure and growth-outlook stories below, are flashing caution.
OPPORTUNITY
Suppliers, tenants, and vendors tied to SM’s retail and property footprint have a reasonable read that consumer spending is still holding up, at least for now, even as the broader growth picture softens.
NEXT MOVE
Watch Q3 same-store sales and consumer spending data for confirmation that this growth is durable rather than front-loaded.
● Government trims its 2027 infrastructure spending program, a quiet signal that fiscal room is tightening
WHAT HAPPENED
The national government lowered its planned infrastructure outlay for 2027 in the latest budget program released this week, according to Inquirer’s business desk.
UNCERTAIN
The available reporting doesn’t specify which individual projects are being scaled back, deferred, or cut entirely, so the practical impact on specific sectors isn’t yet clear.
WHY IT MATTERS
Infrastructure spending has been positioned as a core growth driver by this administration, so a pullback in the forward program is a quieter but meaningful signal that fiscal space is getting tighter, consistent with the BIR collection gap and growth-forecast cuts elsewhere in today’s edition.
RISK
Construction, cement, and steel suppliers reliant on public works contracts should factor in slower project flow. SMEs in these supply chains may want to diversify toward private-sector infrastructure work.
NEXT MOVE
Watch the DBM’s full 2027 budget release for project-level detail on exactly what’s being trimmed.
● BIR crosses P2 trillion in July collections but still needs P1.39 trillion more to hit its 2026 target
WHAT HAPPENED
The Bureau of Internal Revenue has collected around 60% of its annual target for 2026 as of end-July, BIR Commissioner Charlito Martin Mendoza said, leaving P1.39 trillion still to collect against a full-year goal of P3.39 trillion, with four months remaining.
UNCERTAIN
Whether collections in the remaining months keep pace with this run rate isn’t clear. Q4 typically sees a seasonal pickup, but also more exemptions and adjustments filed by taxpayers.
WHY IT MATTERS
Tax collection running behind pace this far into the year adds pressure on the fiscal deficit and could shape how aggressive enforcement gets heading into year-end, which matters directly for SMEs navigating compliance.
RISK
SMEs should expect tighter audits and stricter compliance checks in Q4 as BIR pushes to close the gap, and should make sure documentation is in order well before year-end.
NEXT MOVE
Watch for BIR messaging on stepped-up enforcement measures as the fiscal year winds down.
● PSEi climbs for a second straight session as investors keep favoring strong first-half earners
WHAT HAPPENED
The Philippine Stock Exchange index rose 0.63%, or 39.75 points, to close at 6,366.64 on Wednesday, its second consecutive gain, with the broader All Shares index also up 0.76%. Philstocks Financial attributed the rise to continued bargain hunting alongside strong second-quarter and first-half results from selected stocks.
UNCERTAIN
Whether this is broad-based confidence or narrow, earnings-driven stock-picking isn’t fully clear from the coverage. The rally is happening in the same week Deutsche Bank cut its economy-wide growth forecast.
WHY IT MATTERS
A market rising on individual earnings strength while economy-wide forecasts get cut is a different signal than a market rallying on genuine macro improvement, and it’s worth reading the two together rather than in isolation.
RISK
Businesses shouldn’t read a rising PSEi as a proxy for broad economic health right now. The index gain and the growth-forecast cuts elsewhere in today’s edition are telling different stories.
NEXT MOVE
Watch whether the rally broadens beyond earnings standouts or stays concentrated in a handful of strong reporters.
SECTION 2 · Worth Knowing
● Fresh attacks on Gulf shipping push oil higher as Iran war talks hit a new impasse
WHAT HAPPENED
The U.S. and Yemen’s Iran-aligned Houthis reported separate attacks on shipping Tuesday in the Gulf of Oman and near the entrance to the Red Sea, two vital chokepoints for global oil supply, as Tehran said the Strait of Hormuz stays closed unless Washington accepts its conditions. Brent crude climbed 1.4% to settle at $88.91 a barrel, and global shares retreated on renewed pessimism about a quick end to the conflict, despite repeated claims from President Trump that a deal is imminent.
UNCERTAIN
Whether this marks genuine escalation or another cycle in a conflict that has repeatedly seen near-deals collapse since it began in February isn’t yet clear.
WHY IT MATTERS
The Philippines imports nearly all its oil, so sustained Gulf disruption feeds directly into pump prices, transport costs, and inflation, at a moment when BSP had been hoping to hold rates steady.
RISK
Businesses with fuel-sensitive logistics or import-heavy supply chains should treat this as a real, near-term cost risk rather than a resolved situation, given how many times this conflict has flared back up after apparent progress.
NEXT MOVE
Track Brent crude and BSP commentary on inflation risk over the coming weeks. Fuel-cost budgeting should assume continued volatility, not a quick resolution.
● Deutsche Bank cuts its Philippine 2026 growth forecast to 3.5% after a weaker second quarter
WHAT HAPPENED
Deutsche Bank Research lowered its Philippine GDP growth forecast for 2026, saying the economy may only reach the low end of the government’s target range even with an expected recovery in the second half of the year, citing weaker-than-expected second-quarter activity.
UNCERTAIN
The specific drivers behind this latest cut beyond the general note of a weak Q2 aren’t fully detailed in available coverage.
WHY IT MATTERS
A major foreign bank downgrading its outlook can shape how international investors and rating agencies view Philippine risk, and this cut lands in the same week Inquirer flagged weakening structural growth pillars, two independent signals pointing the same direction.
RISK
Businesses planning 2026 expansion should stress-test plans against a slower-growth scenario. Borrowing costs could stay elevated longer if sentiment continues to sour.
NEXT MOVE
Watch whether other major banks follow with similar downgrades, which would confirm this is becoming a consensus view rather than an outlier call.
● Chinese manufacturers are picking Southeast Asia over Latin America, and the Philippines isn’t topping the list yet
WHAT HAPPENED
A new UOB survey of 380 Chinese companies found 80% plan overseas expansion within three years, with Southeast Asia their top destination choice. Malaysia drew the most interest at 56%, followed by Singapore at 54%, up ten percentage points from a year earlier. China’s trade with the ASEAN bloc rose 18.2% year-on-year to $643.2 billion in the first six months of 2026.
UNCERTAIN
The survey captures expansion interest and planning, not confirmed factory commitments, so it’s unclear how much of this translates into actual investment versus exploratory intent.
WHY IT MATTERS
The Philippines competes directly with Malaysia, Vietnam, and Indonesia for this same wave of relocating manufacturing investment, and right now it isn’t leading that list, a competitiveness signal worth watching alongside the domestic growth-forecast cuts above.
OPPORTUNITY
SMEs in logistics, industrial real estate, and manufacturing-adjacent services could benefit if PH policy shifts to capture more of this relocation wave; the interest exists regionally even if it isn’t yet concentrated here.
NEXT MOVE
Watch DTI and PEZA for any policy response aimed at making the Philippines more competitive for this specific wave of Chinese manufacturing relocation.
SECTION 3 · THE OPPORTUNITY BEHIND THE NEWS
Two Growth Downgrades in One Week Point to the Same Underlying Cost Pressure
The Gulf shipping attacks and the Deutsche Bank downgrade landed in the same 24-hour window, and read together they point to the same underlying tension. Renewed Gulf disruption is keeping oil prices elevated exactly when Deutsche Bank and Inquirer’s own reporting are already flagging a slowing Philippine economy. Higher fuel costs squeeze consumer spending and transport-dependent SMEs first, while a downgraded growth outlook makes it harder for BSP to justify holding rates high enough to fight the resulting inflation.
For business owners with import-heavy supply chains, the practical takeaway is timing: this is a window to lock in fuel and freight costs where contracts allow, since the macro backdrop suggests continued volatility rather than stability through the rest of the year.
SECTION 4 · FOUNDER’S LESSON
Diversification Is Why Big Companies Can Post Good Numbers in a Bad Macro Week
SM Investments and Megaworld both posted strong first-half profits this week, even while the broader economy is being flagged as weakening by Deutsche Bank and Inquirer’s own reporting. That gap isn’t luck. It’s the direct payoff of diversification and scale, revenue spread across retail, banking, property, office, and hotel businesses that most SMEs don’t have the size to replicate.
The lesson for smaller founders isn’t to chase SM’s scale, it’s to borrow its underlying logic: don’t let your business depend on a single revenue line or a single customer segment. When the macro story turns uncertain, as it clearly has this week, businesses with more than one leg to stand on are the ones still posting good numbers a year from now.
SECTION 5 · ONE REAL SIGNAL
This Isn’t a One-Off Spike, It’s the Same Conflict Flaring Up Again After Months of False Endings
The Gulf shipping attacks deserve the deep look over today’s earnings headlines because of what they represent, not just what they cost. This conflict has run since late February and has repeatedly defied “deal is imminent” claims from Washington, only to flare back up days or weeks later. Brent crude at $88.91 isn’t crisis-level pricing yet, but the Philippines has already lived through this exact pattern earlier in 2026, when Middle East tensions pushed inflation forecasts up and forced BSP into unscheduled tightening.
The pattern worth watching over the next two to three weeks is whether this fresh impasse resolves into another ceasefire, or becomes the start of a sustained leg higher in oil. For any SME whose costs are tied to fuel, transport, or imported inputs, that question matters more right now than most domestic data releases this month.
Summarized in our own words with links to every source. We don’t reproduce full articles or bypass paywalls. Interpretation is labeled as such and kept separate from reported fact.
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