SE Asia Stocks-Indices off day's highs at end of strong quarter

* Singapore, Malaysia come off 2-week highs

* Thai stocks fall ahead of market holiday

* Financials and resource shares advance

By Viparat Jantraprap

BANGKOK, June 30 (Reuters) - Southeast Asian stock markets
erased early gains on Tuesday as late selling pulled Singapore
and Malaysia off the two-week highs reached earlier on the back
of hopes for economic recovery and higher oil prices.

Markets in the region posted healthy gains for the
April-June quarter, recovering from their weak performance of
the previous three months amid expectations that economic
growth in Asia could rebound strongly.

But some analysts doubted the rally would run much further
for now.

"Asian stock prices have risen to a level that reflected
most expectations for the economic recovery and any further
rally in upcoming sessions will be limited by caution about the
rich valuations," said Chaiyaporn Nompitakcharoen, head of
research at Bualuang Securities in Bangkok.

Singapore's index .FTSTI ended up 0.7 percent on the day
after an early gain of almost 2 percent to its highest since
June 15, while Malaysia's index .KLSE was flat after climbing
to its highest since June 16.

In Singapore, DBS Group Holdings (DBSM.SI) slid 0.2
percent, Oversea-Chinese Banking Corp (OCBC.SI) was up 1.1
percent and United Overseas Bank (UOBH.SI) was 1.5 percent
higher.

Standard & Poor's Ratings Services affirmed its ratings on
the three Singapore banks, citing their healthy credit
portfolios and liquid, well-capitalised balance sheets.

In Kuala Lumpur, palm plantation firm Sime Darby SIME.BK
fell 1.4 percent and CIMB Bank BUCM.KL was down 1.7 percent
after saying it might revise up its target for return on equity
(ROE).

Maybank (MBBM.KL) rose 0.9 percent and Public Bank
(PUBM.KL) was up 0.6 percent.

Citi rated Malaysia "underweight", seeing no near-term
catalyst for the market.

"Last year was a good year to own Malaysia; it fell less
than the others. We had hoped that changing political
circumstances would prove a catalyst for the market. This has
regrettably not been the case," the broker said.

The Thai index .SETI fell 0.7 percent ahead of a market
holiday on Wednesday, with some banking shares erasing gains
after May economic numbers failed to convince investors that a
strong economic recovery was around the corner.

Siam Commercial Bank SCB.BK lost 2.3 percent and Bank of
Ayudhya BAY.BK slid 4.6 percent, but oil prices jumped more
than 2 percent to a new eight-month high above $73 a barrel and
that boosted energy shares, with PTT PTT.BK up 0.3 percent.

Jakarta .JKSE was down 0.3 percent, with Bank Rakyat
(BBRI.JK) down 4.6 percent and Bank Mandiri (BMRI.JK) off 1.6
percent.

Indonesia rose 41 percent on the quarter, Southeast Asia's
second-best performer, trailing Vietnam's 60 percent.

The Philippine index .PSI fell 1.2 percent, with Ayala
Land (ALI.PS) easing 4.2 percent and conglomerate Ayala Corp
(AC.PS) sliding 4.5 percent.

Vietnam .VNI dropped 2.6 percent, with shares in
Vietcombank VCB.HM, Vietnam's largest partly private lender,
jumping by the maximum 20 percent allowed on their market
debut.
($1 = 34.00 Baht)
(Editing by Alan Raybould)