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Southeast Asian stock markets fell on Monday, in line with regional currencies, amid concerns about sooner-than-expected US interest rate hikes after upbeat jobs data, while further losses in the Indonesian index made it Asia’s worst performer this year.
The Jakarta Composite Index (JCI) shed 1 per cent to 5,044.73, the lowest since April 30.
Foreign investors led the selling in select large-caps such as Bank Mandiri and Unilever Indonesia.
The US rate hike expectations sent the Indonesian rupiah to a fresh 17-year trough on Monday. Other currencies also fell, including Malaysian ringgit which hit a nine-year low.
Rupiah depreciation
The benchmark JCI had fallen 5.7 per cent from the high of 5,347.13 hit on May 26, reflecting concerns about the impact of rupiah depreciation on corporate earnings. It was Asia’s worst performing index, with a year-to-date loss of 3.5 per cent.
The Kuala Lumpur composite index slipped at one point to the lowest since January 13 due to weakness in the ringgit.
Energy shares topped among losers in Malaysia with Tenaga Nasional falling 1.3 per cent and Petronas Gas 0.8 per cent as a fall in global oil prices dented sentiment in the region.
Thailand’s PTT was down 0.9 per cent, Singapore-listed Australia-based oil production company Linc Energy fell 3.9 per cent and Philippine Petron Corp was 1.5 per cent lower.
Bank of Thailand policy meet
Investors in the Thai stock market awaited the central bank’s interest rate decision on Wednesday, with a Reuters poll showing the Bank of Thailand is expected to leave its policy interest rate steady after two surprise cuts in a row.
The SET index was down 0.2 per cent at 1,504.64 at midday.
Strategists at broker Maybank Kim Eng Securities said they were cautious in the near term.
“Although the SET went above the 1,500 level, the light trading volume means only a short-term technical rebound as economic fundamentals remain fragile,’’ they wrote in a report.
“Investors are advised to wait for the BoT’s view of the economic growth outlook on June 10,’’ they said. An index of Asian shares extended losses on Monday in part after Chinese imports declined more than expected.
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