SE Asia Stocks-Singapore hits 14-mth low on US recession fears

By Ovais Subhani

SINGAPORE, Jan 22 (Reuters) - Southeast Asian stocks
plunged on Tuesday, with Singapore's benchmark index falling to
its lowest levels in about 14 months, as investors fled the
market fearing a U.S. recession could derail the global
economy.

Singapore's Straits Times Index .FTSTI fell as much as
5.8 percent to 2,746.73 points, its weakest level since
November 2006. The index recovered just before the close to end
down 1.73 percent, still down about 17 percent since the start
of the year.

Jakarta stocks .JKSE slipped 7.7 percent to a near
four-month low, Malaysian shares .KLSE lost 3.84 percent,
and, by 0941 GMT GMT, Thai stocks .SETI were down 3.26
percent at their lowest in about five months. The Philippine
index .PSI fell 5.52 percent and Vietnam shares .VNI
dropped 3.13 percent.

The losses across the region crushed hopes that Southeast
Asian stock markets, being more domestic driven, would avoid
the full brunt of a global equity sell-off.

"Asian stock markets haven't necessarily decoupled from the
U.S. Even if an economy has a high domestic content, the stock
market is unlikely to escape a bear market," said Alan Chua, a
Singapore-based portfolio manager at Franklin Templeton
Investments' Global Equities Group, which manages US$200
billion worth of assets.

U.S. markets were closed on Monday for a holiday, but stock
index futures SPc1 DJc1 fell around 4.5 percent, signalling
a sharp slide on Wall Street later.

Timothy Wong, head of equities research at DBS Group, said
that while some stock valuations might look attractive, he does
not expect a quick recovery in the region's markets.

"Global investors like pension funds and family offices
have cut their Asian weightings, resulting in indiscriminate
selling," Wong said.

In Singapore, the top losers included property firm Yanlord
Land (YNLG.SI), down 14.9 percent, and plantation firm Wilmar
International (WLIL.SI), which lost 13.7 percent.

However, index heavyweights such as Singapore
Telecommunications (STEL.SI) and Singapore Airlines (SIAL.SI)
both recouped earlier losses to end about 2 percent and 2.4
percent higher.

"Most of the concerns are with the U.S. economy rather than
Asia, so sectors more tied to domestic demand, such as media
and telecoms, are viewed as more defensive," said Wong.

In Indonesia, Telkom Indonesia (TLKM.JK) fell 5.6 percent
and conglomerate Astra International (ASII.JK) dropped 9.6
percent.

Losses in Malaysia were led by plantation firms such as IOI
Corp (IOIB.KL), down 6.4 percent, and Sime Darby (SIME.KL)
which lost 3.5 percent.

Dealers in Bangkok said foreign investors led the selling
spree, having sold Thai shares worth a net 30 billion baht
($904 million) since the start of 2008.

Falling oil prices CLc1 weighed down energy stocks
.SETEN such as Thai Oil TOP.BK, which fell 4.8 percent, and
PTT Exploration and Production PTTE.BK, which was down 5.6
percent.