Asian emerging markets came under
selling pressure on Monday, with the South Korean won and
China’s yuan declining the most, as protests in major Chinese
cities over strict COVID-19 curbs dampened the outlook for the
world’s second-largest economy.
The South Korean won weakened 1.1%, snapping a
three-day winning streak, while the Indonesian rupiah
fell 0.4% for its biggest percentage loss since Nov. 16.
The Singapore and Taiwan dollars gave up
0.2% each, while the Philippine peso slipped marginally.
Investor sentiment was hit by protests in China, a
manufacturing powerhouse and Southeast Asia’s top trading
partner, which flared for a third day and spread to several
cities in a blow to risk appetite.
Khoon Goh, head of Asia research at Australia and New
Zealand Banking Group, said the protests in China hurt risk
sentiment and stoked uncertainty.
“This will continue to be the main driver for Asian markets
in the near term until we see how the situation evolves.”
Markets are adopting cautious approach due to the “unusual
and rare” nature the protests, and on uncertainty about how the
Chinese government will respond to the unrest, Goh said.
Analysts at Barclays are expecting a sharp drop in China’s
economic growth in 2022 to 3.3% from last year’s 8.1%.
The Chinese yuan retreated 0.4% at 0423 GMT to
its lowest level since Oct. 11.
Elsewhere, Thailand’s baht added 0.2%, while stocks
lost 0.2%, with investors cautiously awaiting the
country’s central bank decision on interest rates on Wednesday.
The Bank of Thailand will raise interest rates by a modest
quarter-point for a third straight meeting amid fragile
tourism-reliant growth and signs inflation has started to ease,
a Reuters poll of economists found.
Across the region, most stock indexes remained subdued with
equities in South Korea losing 1.1%, China
giving up 1%, and Taiwan slipping 1.1%.
However, stocks in India and the Philippines
tacked on 0.1% and 0.6%, respectively.
The Philippines’ economic growth may ease next year after a
likely expansion of more than 7% this year as global risks
linger, but it will remain resilient, a top official said on
Separately, South Korea’s central bank and government rolled
out additional support measures for the local credit market,
including a 2.5 trillion won ($1.86 billion) repo operation by
the Bank of Korea to be carried out in December.
** Indonesian 10-year benchmark yields rise 3.6 basis points
** Top losers on the Singapore STI include
Yangzijiang Shipbuilding (Holdings) and CapitaLand
** Markets in Malaysia closed for a holiday
Asia stock indexes and currencies
at 0408 GMT
COUNTRY FX RIC FX FX INDE STOCKS STOCKS
DAILY % YTD % X DAILY YTD %
Japan +0.30 -17.0 <.n2>
India -0.06 -9.06 <.ns ei>
Indonesi -0.41 -9.44 <.jk a se>
Malaysia – -6.95 <.kl se>
Philippi -0.11 -10.1 <.ps nes i>
Singapor -0.16 -2.03 <.st e i>
Taiwan -0.20 -10.6 <.tw ii>
Thailand -0.06 -6.82 <.se ti>
(Reporting by Roushni Nair in Bengaluru
Editing by Shri Navaratnam)