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EMERGING MARKETS-SMIC curbs help S.Korean, Taiwan stocks after Chinese data boost

Published 09/28/2020, 04:16 PM
Updated 09/28/2020, 04:20 PM
© Reuters.
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* Jakarta COVID-19 curbs extended
* Malaysia's ruling coalition wins state election; reduces
political uncertainty
* South Korea, Taiwan chipmakers rise after U.S tightens
exports
to China's SMIC

Sept 28 (Reuters) - South Korean and Taiwanese stocks each
closed over 1% higher on Monday as investors priced in a boost
for their tech-focussed economies from tighter U.S. curbs on
China's biggest chipmaker, adding to a bright start to the week
for most Asian markets.
Data showing profits at Chinese industrial firms grew for a
fourth straight month underpinned stock markets in the region,
although the extension of export curbs on Semiconductor
Manufacturing International Corp 0981.HK 688981.SS left
Shanghai's broad index .SSEC marginally lower. The dual-listed chipmaker's shares plunged more than 5% in
both Shanghai and Hong Kong. Local chipmakers gained the most in Seoul, helping the
market .KS11 rise 1.3% as the number of domestic COVID-19
infections fell to its lowest in nearly two months. Taiwan's
stock market .TWII ended nearly 2% higher.
"The knee-jerk reflex (to the SMIC decision), apart from
caution, may be for Japanese, Korean and Taiwanese chipmakers to
opportunistically benefit from substitution trades," analysts
from Japanese bank Mizuho said in a note.
China's recovery has been among the few bright spots for the
global economy as a second wave of coronavirus infections mounts
in Europe, prompting countries to reimpose restrictions and
quashing hopes that the continent was turning a corner.
One of a handful of Asian countries still struggling to get
COVID-19 numbers down is Indonesia and stocks there .JKSE fell
0.5% as curbs were extended in the capital Jakarta.
India is also struggling, but markets there .NSEI climbed
1.4% on hopes that the government would pump more money into
public sector banks. The Reserve Bank of India is expected to leave its key
interest rate unchanged on Thursday with inflation above its
limit. Some see an end to the central bank's easing cycle in
which it has slashed rates by 115 basis points since March.
Currencies were more of a mixed bag, with most flat to
slightly lower as the day progressed against a dollar that was
little changed. FRX/
Taiwan's dollar TWD=TP stood out, rising 0.7% against the
greenback, cementing itself as the region's second-best
performer this year as its tech-focused and export-oriented
economy reaps the benefits of the stay-at-home life.
Malaysia's ringgit MYR= was flat after a victory by the
ruling party in a state election calmed investor nerves that saw
the currency lose around 1.4% last week after opposition leader
Anwar Ibrahim's said he had a majority to oust the government.

** Indonesian 3-year benchmark yields down 9.2 basis points
to 5.073%
** Malaysia's 10-year benchmark yield down 1.79 basis points
to 2.78%

Asia stock indexes and currencies at 0706 GMT
COUNTRY FX RIC FX FX INDEX STOCKS STOCKS
DAILY % YTD % DAILY % YTD %
Japan JPY= +0.20 +3.06 .N225 1.32 -0.61
China CNY=CFXS +0.00 +2.07 .SSEC -0.04 5.50
India INR=IN -0.01 -3.04 .NSEI 1.39 -7.92
Indonesia IDR= -0.03 -6.53 .JKSE -0.46 -21.85
Malaysia MYR= -0.02 -1.94 .KLSE 0.11 -4.91
Philippines PHP= -0.04 +4.46 .PSI 0.39 -25.00
S.Korea KRW=KFTC -0.11 -1.47 .KS11 1.29 5.02
Singapore SGD= +0.07 -2.30 .STI 0.38 -23.00
Taiwan TWD=TP +0.69 +3.55 .TWII 1.88 3.88
Thailand THB=TH -0.28 -5.65 .SETI 1.23 -20.23


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