December 12, 2013 / 6:26 AM / 4 years ago

SE Asia Stocks-Philippine, Indonesia underperform ahead of rate move

BANGKOK, Dec 12 (Reuters) - Thai stocks retreated on
Thursday amid the domestic political impasse while stocks in the
Philippines and Indonesia came under pressure of profit-taking
as investors were wary of the prospect of U.S. stimulus tapering
and ahead of policy interest rate reviews at home.
    Thai SET index was down 0.5 percent at midday, after
a modest gain on the previous session. Consumer and
tourism-related shares led decliners, including airport operator
Airports of Thailand and retailer CP All.
    Anti-government protesters in Thailand pinned their hopes on
winning support from the powerful security forces on Thursday as
they push to oust Prime Minister Yingluck Shinawatra and install
an unelected administration. 
    On Monday, Yingluck dissolved the parliament and called an
early election for Feb. 2.
    Rating agency Moody's Investors Service said dissolution of
parliament and early elections will not resolve Thailand's
political crisis.
    "The key credit-negative feature for the sovereign is that
prolonged protests will weigh on an already fragile growth
outlook for 2014," it said in a report dated Dec. 12.
    The Philippine main index dropped 1.5 percent, led by
shares of Bank of the Philippine Islands and Aboitiz
Equity Ventures. Analysts have expected the Philippine
central bank to keep its key policy rate steady on Thursday.
    "I don't think the central bank is going to do anything
today. There's some foreign selling which should be to do with
the outlook of tapering and could be also because they are
closing out positions for the end of the year," said
Manila-based Joseph Roxas, president of broker Eagle Equities.
    A Reuters poll showed all the 10 analysts surveyed said the
central bank's policy making Monetary Board will vote to hold
the overnight borrowing rate at a record low of 3.5
percent at its final meeting this year. 
    Jakarta's Composite Index fell 1.1 percent as the
rupiah hit a near five-year low ahead of the central
bank's rate decision due later on the day. 
    Profit-booking hit shares of dollar earnings firms such as
United Tractors and Astra Agro Lestari that
had seen strong buying interests over the past week.
    "We expect the market to focus on macro news until next
week, with Bank Indonesia's rate set to be decided today and
market speculating that Fed may decide to start tapering during
its meeting on Dec. 17-18," said Trimegah Securities in a
report.
    Indonesia's central bank will likely keep its benchmark
reference rate on hold at 7.50 percent at its policy
meeting on Thursday as the rupiah stays under pressure
from an expected tapering in U.S. stimulus. 
    Stocks in Singapore eased 0.2 percent, hovering
around their lowest in more than three months and extending
their seven straight sessions of losses. Malaysia was
down 0.3 percent, further pulling off a record hit on Tuesday.
    Vietnam edged up 0.07 percent, reversing its earlier
fall after Moody's said the stable outlook on Vietnam's B2
government bond rating reflects a firming of macroeconomic
settings and initial progress on the restructuring of the
banking system. 
    
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SOUTHEAST ASIAN STOCK MARKETS
 Change at 0601 GMT
 Market             Current     Prev Close    Pct Move
 TR SE Asia Index*   391.10        392.17       -0.71
 Singapore          3055.34       3056.97       -0.18
 Kuala Lumpur       1837.19       1840.54       -0.31
 Bangkok            1361.96       1365.07       -0.54
 Jakarta            4224.21       4240.49       -1.11
 Manila             5797.84       5888.74       -1.54
 Ho Chi Minh         505.68        505.94       +0.07

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