BANGKOK: Most Southeast Asian stock markets gained on Monday, Oct 11 as investment funds continued to flow into emerging markets amid expectations the U.S. Federal Reserve will introduce further measures to boost the economy.
Investors pushed Malaysia to a 33-month high while Singapore, Thailand and Indonesia all snapped two-day losing streaks. Broad Asian stock markets rose as U.S. job data boosted the chances of easier U.S. monetary policy, even though IMF and G7 meetings produced little to ease global currency tensions.
The trend of selling dollars to buy emerging market assets and commodities was expected to continue and by 0948 GMT the MSCI Asia ex-Japan index was up 0.46 percent. In Bangkok, turnover fell to $903 million from an average $1.23 billion so far in the month.
Investors stayed on the sidelines ahead of a cabinet meeting on Tuesday that may discuss measures to deal with appreciation in Thai baht, including taxes on bond investments. "Concern about possible currency measures has gripped the market since last week," said Pichai Lertsupongkij, head of sales at Thanachart Securities.
"The market regained most of the ground lost after newspapers unveiled possible measures today that may not involve the stock market. Overall, investors are waiting for further details," he said. Thai bond yields surged as investors waited for the government measures. The baht has appreciated 11 percent this year, making it the second-strongest Asian currency after the yen, to the dismay of exporters.
Gains in Bangkok were boosted by energy shares, which have the largest weight on the broad market of over 20 percent. PTT Pcl, the biggest energy firm, rose 1.32 percent, with dealers attributing the positive sentiment to rising oil prices.
The prospect of higher demand for palm oil pushed prices in palm oil shares up across the region, traders said. Singapore's Golden Agri-Resources rose 5.2 percent, rival Indofood Agri Resources climbed 7 percent, Malaysia's IOI Corp gained 1.5 percent and Indonesia's Astra Agro Lestari jumped 7.1 percent.
Elsewhere, Vietnam was flat after a loss on Friday while the Philippines, bucking the trend, fell 0.4 percent despite hitting an all-time high at one point, with conglomerate Alliance Global Group Inc easing 0.4 percent after hitting a record high on Friday.
Foreign investors sold Philippine shares worth a net $3.8 million, snapping steady inflows over the past three weeks. Despite the loss, Manila, Southeast Asia's best performer last week, remained overbought by some yardsticks. Its 14-day relative strength index (RSI) was at 76.71 at the close on Monday, coming off Friday's 80.4 but still well above 70, which indicates the market is overbought.
Indonesia, which has pulled off a record high since last week, and Malaysia, which marked a new multi-year high on the day, were among overbought markets, with their RSI at 72.4 and 72.37 respectively.
The region's valuations remain relatively high, led by Indonesia's 12-month forward price to earnings ratio of 15.6 against all-Asia's 13.3, according to Thomson Reuters StarMine. That was followed by Malaysia's 15.1, the Philippines' 14.6, Singapore's 14.1, Thailand's 12.5 and Vietnam's 12.4. - Reuters
Investors pushed Malaysia to a 33-month high while Singapore, Thailand and Indonesia all snapped two-day losing streaks. Broad Asian stock markets rose as U.S. job data boosted the chances of easier U.S. monetary policy, even though IMF and G7 meetings produced little to ease global currency tensions.
The trend of selling dollars to buy emerging market assets and commodities was expected to continue and by 0948 GMT the MSCI Asia ex-Japan index was up 0.46 percent. In Bangkok, turnover fell to $903 million from an average $1.23 billion so far in the month.
Investors stayed on the sidelines ahead of a cabinet meeting on Tuesday that may discuss measures to deal with appreciation in Thai baht, including taxes on bond investments. "Concern about possible currency measures has gripped the market since last week," said Pichai Lertsupongkij, head of sales at Thanachart Securities.
"The market regained most of the ground lost after newspapers unveiled possible measures today that may not involve the stock market. Overall, investors are waiting for further details," he said. Thai bond yields surged as investors waited for the government measures. The baht has appreciated 11 percent this year, making it the second-strongest Asian currency after the yen, to the dismay of exporters.
Gains in Bangkok were boosted by energy shares, which have the largest weight on the broad market of over 20 percent. PTT Pcl, the biggest energy firm, rose 1.32 percent, with dealers attributing the positive sentiment to rising oil prices.
The prospect of higher demand for palm oil pushed prices in palm oil shares up across the region, traders said. Singapore's Golden Agri-Resources rose 5.2 percent, rival Indofood Agri Resources climbed 7 percent, Malaysia's IOI Corp gained 1.5 percent and Indonesia's Astra Agro Lestari jumped 7.1 percent.
Elsewhere, Vietnam was flat after a loss on Friday while the Philippines, bucking the trend, fell 0.4 percent despite hitting an all-time high at one point, with conglomerate Alliance Global Group Inc easing 0.4 percent after hitting a record high on Friday.
Foreign investors sold Philippine shares worth a net $3.8 million, snapping steady inflows over the past three weeks. Despite the loss, Manila, Southeast Asia's best performer last week, remained overbought by some yardsticks. Its 14-day relative strength index (RSI) was at 76.71 at the close on Monday, coming off Friday's 80.4 but still well above 70, which indicates the market is overbought.
Indonesia, which has pulled off a record high since last week, and Malaysia, which marked a new multi-year high on the day, were among overbought markets, with their RSI at 72.4 and 72.37 respectively.
The region's valuations remain relatively high, led by Indonesia's 12-month forward price to earnings ratio of 15.6 against all-Asia's 13.3, according to Thomson Reuters StarMine. That was followed by Malaysia's 15.1, the Philippines' 14.6, Singapore's 14.1, Thailand's 12.5 and Vietnam's 12.4. - Reuters
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