Capital flight fears sink Jakarta, Manila shares

A man stands next to an electronic stock board at the Indonesia Stock Exchange in Jakarta on Friday. (Reuters photo)

Most Southeast Asian stock markets fell on Friday over investor fears that a rise in US interest rates under President-elect Donald Trump would suck capital out of emerging markets.

Emerging Asian currencies, including the Malaysian ringgit and the Indonesian rupiah, and bonds lost ground as US bond yields soared on views Trump's spending plans would push up inflation. The dollar was on course for its best week in a year on Friday.

Feeble oil prices also added to the gloom as markets refocused on a persistent fuel supply overhang.

Indonesian and Philippine shares fell the most in the region, losing 4% and nearly 3%, respectively.

Indonesian shares closed at their lowest in two months, led by financials and consumer-oriented stocks, posting their biggest single-day percentage loss since August 2015 and the worst weekly performance in nearly 12 months. PT Bank Central Asia Tbk, the biggest bank by market value, finished 2.8% weaker.

"Investors look to Indonesia when they think about emerging Asian markets and the resurfacing concern on trade likely weighed more heavily on the market," said Jingyi Pan, a market strategist with IG Asia in Singapore. 

Indonesian markets have enjoyed relatively high inflows into its stock and bonds markets in the past few months, making them vulnerable to hot money outflows in times of uncertainty.

Philippine shares fell, dragged down by consumer and industrial stocks. The index has lost 3.5% on the week, its worst weekly performance since January.

Malaysian stocks closed at their lowest in more than four months, hurt by telecom and financials, with the Malaysian central bank acting to try to defend its currency. Foreign investors net sold 690.9 million ringgit ($161.43 million) worth of shares. The index ended lower for a second consecutive week.

Southeast Asian stock markets

 

 

Current

Previous

% change

Indonesia

5,231.97

5,450.30

-4.01

Malaysia

  1,634.19

1,652.74

-1.12

Philippines

6,975.09

7,181.80

-2.88

Singapore

2,814.60

2,834.09

-0.96

Vietnam

679.02

678.17

-0.15

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Source: Capital flight fears sink Jakarta, Manila shares