August 15, 2019 / 10:52 AM / 2 months ago

SE Asia Stocks-Most end lower as global risk aversion mounts

    * U.S. curve inverts for first time in 12 years
    * Singapore hurt by losses in financial sector
    * Vietnam claws back ground to end 1.1% higher

    By Soumyajit Saha
    Aug 15 (Reuters) - Most Southeast Asian stock markets ended
lower on Thursday, tracking a global downturn in equities as an
inversion in the U.S. bond yield curve triggered recession
fears, while the Vietnam index closed at its highest in
two weeks.
    For the first time since 2007, the yield on the U.S.
Treasury 10-year note temporarily fell below the
two-year yield, widely regarded as an indicator of
dire global trading conditions.
    The yield curve inversion has preceded every recession
barring one in the last 50 years. 
    Risk appetite was all but eradicated as the inversion came
shortly after economic data showed China's industrial output
growth cooling to a more than 17-year low, pointing towards a
slowdown in Southeast Asia's biggest trading
partner.
    Adding to market uncertainty, no trade concessions were made
by Beijing following the postponement of 10% tariffs on over
$150 billion worth of Chinese imports by U.S. President Donald
Trump, senior U.S. officials said on Wednesday.
    Trump's unpredictability with regards to trade escalation
and de-escalation is also "making trading next to impossible to
carry a short-term view," Stephen Innes, managing partner at VM
Markets Pte Ltd, said in a note to clients.  
    Trading was difficult "even more so with the markets risk
barometers so intricately dialled into the U.S.-China trade
development," Innes said.
    Singapore shares closed at their lowest in over two
months, hurt mostly by losses in the financial sector.
Oversea-Chinese Banking Corp and United Overseas Bank
 ended down 3.6% and 2.9%, respectively.
    Oversea-Chinese Banking's shares dropped after Bloomberg
reported it was weighing a bid for Standard Chartered'
Indonesian bank PT Bank Permata. tinyurl.com/y5es9fyh
    Thai shares closed at their lowest since Jan. 22,
dented by losses in telecom and financial sectors.
    Telecom company Intouch Holdings Pcl lost 5%
after units of Singapore's sovereign fund Temasek launched an
overnight block trade for 15.6 billion baht ($505.67 million)
worth of its stakes in Intouch.
    Bucking the trend, Vietnam stocks closed 1.1% firmer as most
sectors ended in the positive territory on the day of expiry of
futures contract. 
    "The movement looks more speculative than based on the
fundamentals of the market," Tiung Le, macro-market researcher
at BIDV Securities said, adding that it was the expiration date
of August future contracts for the Vietnam 30 Index,
which was prompting some hedging through selective buying in the
market.
    The Vietnam 30 Index is largely composed of blue-chip
stocks, and accounted for most of the broader index's gains. 
    The benchmark index was mainly boosted by financial stocks,
with heavyweights Vingroup JSC and Joint Stock Bank For
Foreign Trade of Viet Nam ending up about 2% and 3.5%,
respectively. 
                
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SOUTHEAST ASIAN STOCK MARKETS
 STOCK MARKETS                                    
 Change on the day                                
 Market                 Current   Previous close  Pct Move
 Singapore              3126.09   3147.6          -0.68
 Bangkok                1604.03   1619.45         -0.95
 Manila                 7828.86   7858.65         -0.38
 Jakarta                6257.586  6267.335        -0.16
 Kuala Lumpur           1600.29   1600.31         0.00
 Ho Chi Minh            979.38    968.91          1.08
                                                  
 Change so far in 2019                            
 Market                 Current   End 2018        Pct Move
 Singapore              3126.09   3068.76         1.87
 Bangkok                1604.03   1563.88         2.57
 Manila                 7828.86   7,466.02        4.86
 Jakarta                6257.586  6,194.50        1.02
 Kuala Lumpur           1600.29   1690.58         -5.34
 Ho Chi Minh            979.38    892.54          9.73
 
 (Reporting by Soumyajit Saha, Editing by Sherry Jacob-Phillips)
  
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