EMERGING MARKETS-Emerging Asian stocks, FX on relief rally as Fed steps in

* Indonesia shares up nearly 3%
* S.Korean won strengthens 0.7%
* Graphic: Foreign flows into Asian stocks https://tmsnrt.rs/3f2vwbA

June 16 (Reuters) - Stocks and currencies in emerging Asian
markets rallied on Tuesday after the Federal Reserve announced
the launch of its corporate bond buying programme, giving relief
to investors otherwise fearing a fresh outbreak of coronavirus
in China.
The Fed's announcement gave a much-needed boost to risk
appetite in Asia, where currencies and stocks had sold off after
the emergence of new cluster of COVID-19 cases in Beijing, and
other countries as lockdowns are eased gradually. it is almost inevitable that we see bouts of new
virus cases globally, ultimately the massive liquidity injection
from major central banks will overshadow concerns, in our view,"
said Edward Ng, a Singapore-based portfolio manager at Nikko
Asset Management.
Despite previously being announced, the Fed's programme to
buy investment grade U.S. corporate bonds in the secondary
market from Tuesday came with more details overnight, lending
support to Wall Street and reinforcing hopes that authorities
would continue to flood the market with liquidity. According to Bloomberg News, the U.S. government is also
preparing a nearly $1 trillion infrastructure proposal.
Stock markets in Indonesia .JKSE , Singapore .STI and
Thailand .SETI all climbed more than 2% each.
The improved risk appetite drove gains in currency markets
as well, at the expense of the dollar, with the South Korean won
KRW=KFTC the best performer.
"We see once again that the dollar is guided by risk," Chris
Weston, head of research at Melbourne-based brokerage
Pepperstone wrote in a note to clients, adding that the dollar
is likely to be sold as stock markets rise and credit spreads
tighten.
The pace of reopening has varied across much of Asia as
countries weigh the economic ramifications of a prolonged
shutdown, and fresh outbreaks.
Singapore said late on Monday that most coronavirus
restrictions would be eased by Friday but, in the Philippines,
partial restrictions in Manila would remain for two more weeks.
In India, where restrictions have been gradually easing,
despite the rising case load, the southern city of Chennai
announced it was going back into lockdown.
The Finance Minister of Indonesia said the country's economy
was likely to shrink by 3.1% in the second quarter from a year
ago due to weak activity brought about by the virus-led curbs.

Asia stock indexes and currencies at 0416 GMT
COUNTRY FX RIC FX DAILY % FX YTD % INDEX STOCKS DAILY % STOCKS
YTD %
Japan JPY= -0.12 +1.09 .N225 4.05 -5.30
China CNY=CFXS +0.22 -1.56 .SSEC 0.87 -4.43
India INR=IN +0.00 -6.10 .NSEI 1.87 -17.73
Indonesia IDR= +0.21 -1.00 .JKSE 2.88 -21.29
Malaysia MYR= +0.27 -4.13 .KLSE 1.82 -3.95
Philippines PHP= +0.26 +1.10 .PSI 1.13 -20.24
S.Korea KRW=KFTC +0.72 -4.22 .KS11 4.16 -3.75
Singapore SGD= +0.16 -3.18 .STI 2.52 -16.85
Taiwan TWD=TP +0.46 +1.59 .TWII 1.88 -3.99
Thailand THB=TH +0.23 -3.64 .SETI 2.36 -13.12