SE Asia Stocks-Mostly turn higher, but Thailand loses gains

* Banks lead gainers in S'pore, Malaysia

* Indonesia recoups losses; big caps support

* Thailand falls back; telecom shares drag

By Viparat Jantraprap

BANGKOK, Oct 30 (Reuters) - Most Southeast Asian stock
markets gained ground on Friday, with banks reversing recent
losses in Singapore and Malaysia while Indocement and Indofood
led gainers in a rebound in Jakarta.

Sentiment in the region turned cautious in the afternoon
session and late selling pulled markets down from the day's
highs.

Dealers said investors were waiting for interest rate
decisions next week by the U.S. Federal Reserve, Bank of
England and European Central Bank, but the mood remains
positive overall.

"I don't believe fund flows will get cautious on Asia, in
the long term. Asian fundamentals remain strong structurally,
with further earning revisions ahead," said Desmond Tjiang at
Fortis Investments in Hong Kong.

"Since the crisis last year, we still have net outflows
from Asia. There are good reasons to believe that Asian
fundamentals are strong enough to attract that money back into
Asia, in the long term. We maintain overweight on China and
Indonesia."

Indonesia's index .JKSE gained 1 percent after a four-day
loss of 5 percent. Indocement (INTP.JK) surged 8.3 percent
while Indofood (INDF.JK) jumped nearly 7 percent.

Singapore's index .FTSTI ended up 0.7 percent after an
early gain of almost 2 percent and Malaysia's index .KLSE
inched up 0.12 percent,

In Singapore, top lender DBS Group Holdings (DBSM.SI) rose
1.1 percent and United Overseas Bank (UOBH.SI) climbed 2.2
percent. In Kuala Lumpur, number two lender CIMB (CIMB.KL)
gained 1.3 percent and AMMB Holdings (AMMB.KL) was up 1.7
percent.

Malaysia's index was 3.4 percent higher in October,
Southeast Asia's second best performer after the Philippines'
3.8 percent rise.

Thailand's stock index .SETI lost its early gain to end
down 0.7 percent as telecom shares fell as an auction of
third-generation mobile phone licences looks likely to be
delayed yet again.

True Corp TRUE.BK, which owns number three mobile phone
operator True Move, dropped 3.9 percent, leader Advanced Info
Service ADVA.BK lost 2.3 percent and second-ranked Total
Access Communication DTAC.BK eased 0.6 percent.

The Philippines .PSI gained 1.6 percent, led by a 7
percent rise in Philex Mining (PX.PS) and a 3.3 percent rise in
Bank of the Philippine Islands (BPI.PS).
($1=33.41 Baht)
(Additional reporting by Saeed Azhar in Singapore; Editing by
Alan Raybould)