COLOMBO: Southeast Asian stock markets closed weaker on Wednesday, Nov 17 continuing a losing trend on foreign outflows, worries over euro zone debt, fears of a rise in Chinese interest rates and talk over capital controls.
Foreign selling hit Thailand and the Philippines as foreign institutions cashed in profits, although local retail investors were on the buying side.
Thailand fell 1.1 percent to its lowest since Oct. 29, hit by foreign outflows of $115.4 million, the largest since May 26. The region's second-best performer this year has seen net outflows of $318.7 million in the last six sessions with a 6.2 percent drop in the market.
"Concerns in the euro area and in China continue," said Pichai Lertsupongkij, head of sales at Bangkok-based Thanachart Securities. "Foreigners are exiting to minimise exposure as the Bank of Thailand considers a tax on capital inflows."
On Wednesday, a finance ministry official said Thailand will study the use of levies such as a Tobin-style tax on international transactions to control inflows of global capital, but there was no plan to impose them soon.
Lertsupongkij said the market has hardly seen any new brokerage accounts opened this month and only existing local retailers have been buying shares in the bourse.
Fears over China raising interest rates to curb rising inflation and worries over the euro zone debt crisis with Ireland resisting a bailout weighed on regional markets.
Banks and the energy sector led Thai losses with a 22 percent fall in Siam City Bank, which announced plans to delist before merging with Thanachart Capital. A 1.6 percent loss in top energy firm PTT also squeezed the market.
In Manila, stocks fell to their lowest since Sept. 23. Its main index has lost 7.8 percent in the last eight sessions.
"Foreigners exited from the market due to global concerns," said Jose Mari, an analyst at Manila-based Campos, Lanuza & Company Inc. "The selloff will continue with high valuations in the Philippines and regional markets as well."
Indonesia is trading at a 15.5 forward price-to-earnings ratio, below all-Asia's 13.3 and richer than Thailand's 12.1.
The Philippines is trading at 13.3, while Singapore and Malaysia are trading at 14.0 and 14.1 respectively, Thomson Reuters StarMine data showed.
In Hanoi, the market dropped 0.3 percent to its lowest since Aug. 25. - Reuters
Foreign selling hit Thailand and the Philippines as foreign institutions cashed in profits, although local retail investors were on the buying side.
Thailand fell 1.1 percent to its lowest since Oct. 29, hit by foreign outflows of $115.4 million, the largest since May 26. The region's second-best performer this year has seen net outflows of $318.7 million in the last six sessions with a 6.2 percent drop in the market.
"Concerns in the euro area and in China continue," said Pichai Lertsupongkij, head of sales at Bangkok-based Thanachart Securities. "Foreigners are exiting to minimise exposure as the Bank of Thailand considers a tax on capital inflows."
On Wednesday, a finance ministry official said Thailand will study the use of levies such as a Tobin-style tax on international transactions to control inflows of global capital, but there was no plan to impose them soon.
Lertsupongkij said the market has hardly seen any new brokerage accounts opened this month and only existing local retailers have been buying shares in the bourse.
Fears over China raising interest rates to curb rising inflation and worries over the euro zone debt crisis with Ireland resisting a bailout weighed on regional markets.
Banks and the energy sector led Thai losses with a 22 percent fall in Siam City Bank, which announced plans to delist before merging with Thanachart Capital. A 1.6 percent loss in top energy firm PTT also squeezed the market.
In Manila, stocks fell to their lowest since Sept. 23. Its main index has lost 7.8 percent in the last eight sessions.
"Foreigners exited from the market due to global concerns," said Jose Mari, an analyst at Manila-based Campos, Lanuza & Company Inc. "The selloff will continue with high valuations in the Philippines and regional markets as well."
Indonesia is trading at a 15.5 forward price-to-earnings ratio, below all-Asia's 13.3 and richer than Thailand's 12.1.
The Philippines is trading at 13.3, while Singapore and Malaysia are trading at 14.0 and 14.1 respectively, Thomson Reuters StarMine data showed.
In Hanoi, the market dropped 0.3 percent to its lowest since Aug. 25. - Reuters
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