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EMERGING MARKETS-Indonesia stocks trip as c.bank seen holding rates

Published 09/15/2020, 03:42 PM
Updated 09/15/2020, 03:50 PM
© Reuters.
USD/JPY
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USD/SGD
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JP225
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USD/IDR
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USD/MYR
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USD/PHP
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NSEI
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JKSE
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KLSE
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KS11
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TWII
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SSEC
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SETI
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PSI
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PDES
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0700
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BLOOM
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AGI
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STI
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MBT
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ASBI
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TDPM
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* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
* Graphic: Foreign flows into Asian stocks https://tmsnrt.rs/3lKhL5I
* Bank Indonesia expected to hold interest rates - Reuters poll
* Experts call for BI to remain independent
* Singapore stocks snap 5-day losing run

By Shashwat Awasthi
Sept 15 (Reuters) - Indonesia stocks pulled back on Tuesday after a more than 5% surge over
the last two sessions as a Reuters poll of analysts predicted the country's central bank would
stand pat on interest rates in favour of supporting an under-pressure rupiah.
Upbeat Chinese data supported other emerging Asian share markets at the start of a week that
also sees meetings of the U.S. Federal Reserve and Bank of Japan. Jakarta's stock market .JKSE , however, was the biggest decliner ahead of Thursday's
central bank meeting and after Indonesia reported a steeper-than-expected drop in imports and
exports for August. Brokerage Samuel Sekuritas in a note to clients also cited profit-taking for the weakness in
Indonesian equities.
Bank Indonesia (BI) has had to intervene to stabilize the currency multiple times this month
as foreign investors worry about the bank's independence, the country's debt and growth
prospects.
The rupiah IDR= firmed as much as 0.2% and stocks came off session lows, however, after
experts insisted BI must remain independent while calling for an expansion of the bank's mandate
before a parliamentary committee. Other regional currencies also rose against a subdued U.S. dollar.
The dollar has been sold heavily against its developed world counterparts in the past three
months, and data on speculative positions show global investors are also net "long" on emerging
currencies against the greenback, following the Fed's rejigging of its policy framework to spur
growth and inflation.
The emerging positions, however, are far less extended, reflecting the risks investors see
around growth and the heavy load of coronavirus cases across a number of major developing
markets.


Singapore stocks .STI advanced 0.5%. Jeffrey Halley, a strategist with trading platform
OANDA, attributed the move to a sign of confidence in the local market after China's Tencent
0700.HK chose the city-state as its Asia hub. In the Philippines, which reported record coronavirus deaths for the second time in three
days on Monday, shares .PSI recouped earlier losses to gain 0.4%. "While the overall tone remains cautious over fears of COVID-19 cases resurgence due to
gradual easing of physical distancing protocols, market's risk appetite seems to have picked
up," said Jennifer Lomboy, a fund manager at First Metro Asset Management.
"With the strong run of some defensive names, local players were seen slowly shifting to
cyclicals as market confidence on economic recovery builds up."

HIGHLIGHTS

** Indonesian 3-year benchmark yields are up 27.9 basis points at 4.971%
** Top losers on the Jakarta stock index include Destinasi Tirta Nusantara PDES.JK down
6.99%, Asuransi Bintang ASBI.JK down 6.94% and Tridomain Performance Materials TDPM.JK down
6.94%
** In the Philippines, top index gainers are Alliance Global AGI.PS up 2.95%, Bloomberry
Resorts BLOOM.PS up 2.79% and Metropolitan Bank and Trust MBT.PS up 2.72%


Asia stock indexes and currencies at 0656 GMT
COUNTRY FX RIC FX DAILY % FX YTD % INDEX STOCKS DAILY % STOCKS YTD %
Japan JPY= +0.05 +2.78 .N225 -0.44 -0.85
China CNY=CFXS +0.34 +2.62 .SSEC 0.53 8.07
India INR=IN -0.03 -2.88 .NSEI 0.44 -5.57
Indonesia IDR= +0.20 -6.41 .JKSE -0.93 -18.82
Malaysia MYR= +0.31 -0.99 .KLSE 0.51 -4.38
Philippines PHP= -0.10 +4.48 .PSI 0.35 -22.99
S.Korea KRW=KFTC +0.38 -1.92 .KS11 0.65 11.19
Singapore SGD= +0.26 -1.19 .STI 0.45 -22.63
Taiwan TWD=TP +0.90 +3.02 .TWII 0.45 7.07
Thailand THB=TH +0.32 -4.20 .SETI 0.49 -19.07

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Emerging currencies positions versus the Dollar https://tmsnrt.rs/2Fzi6rh
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