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Philippines, Indonesia stocks hit more than one-week lows

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by July 21, 2017 General

Indonesian stocks were dragged down by consumer discretionary and financial stocks, falling 0.5 per cent. — Reuters pic Indonesian stocks were dragged down by consumer discretionary and financial stocks, falling 0.5 per cent. — Reuters pic SINGAPORE, July 21 — Most South-east Asian stocks fell today, in line with Asian markets, after the European Central Bank and the Bank of Japan kept rates steady and signalled that they were in no hurry to start unwinding their massive stimulus programmes.

Asian markets edged down, with MSCI’s broadest index of Asia-Pacific shares outside Japan, which has gained about 5 per cent in the past two weeks, easing 0.2 per cent.

The ECB did not even discuss clawing back stimulus at its meeting yesterday, suggesting it may delay an inevitable decision on tapering bond buys until the last possible moment.

The Bank of Japan once again pushed back the timing for achieving its ambitious inflation target, with BOJ Governor Haruhiko Kuroda arguing that maintaining its massive stimulus alone would help boost growth and inflation.

“With both the ECB and BOJ sounding a tad cautious, financial markets may revert to business as usual mode today,” OCBC Bank said in a research note.

In South-east Asia, Philippine stocks dropped to their lowest in more than one week, led by financials.

Metropolitan Bank and Trust posted its biggest intraday percentage drop since November 2016, while GT Capital Holdings fell to a near two-month low.

Indonesian stocks shed as much as 0.5 per cent, dragged down by consumer discretionary and financial stocks.

Indonesia’s central bank held benchmark interest rates unchanged, although it said the economy likely grew more slowly than initially expected in the second quarter.

“Thursday’s statement offered no strong hint that BI (Bank Indonesia) is about to tweak its policy stance anytime soon,” said DBS Bank said in a research note. “As long as rupiah stability is maintained, it is likely that BI will stand pat in August as well.”

An index of the region’s 45 most liquid stock fell as much as 0.7 per cent.

Astra International dropped to a more than two-month low, while Bank Mandiri shed as much as 2.2 per cent.

Singapore stocks, however, rose as much as 0.4 per cent, led by real estate and telecommunication shares.

CapitaLand Ltd hit a near three-month high, while Singapore Telecommunications posted its biggest intraday percentage gain in one week. — Reuters

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